CASH 1 Blog – News
<p><strong>Revolving Credit:</strong> Your lender advances a set credit limit that you use all at once or in part. You borrow the money, spend it, repay it, and spend it again with revolving credit.</p>
<p><strong>Installment Credit:</strong> Your lender advances the total amount, and you repay it with scheduled, periodic payments. You gradually reduce the principal, which leads to paying off the original amount.</p>
<h2>What Is Revolving Credit?</h2>
<p>A <a href=”/personal-line-of-credit-loans.aspx” rel=”noopener” target=”_blank”>line of credit (LOC)</a> or credit card is the most common revolving credit form. When you make payments on this credit line, your credit limit does not change. You can borrow from it as much as you want if you do not exceed the original limit. There isn’t a set payment plan because you are not borrowing a lump sum. You can borrow up to your credit limit. You’ll pay more for this flexibility, higher interest rates, and possibly a lower borrowing amount. You’ll only be charged for the amount you withdraw every month, not the entire credit limit.</p>
<h2>What Is Installment Credit?</h2>
<p>A car loan or mortgage is the most common form of this type. Installment credit is an account with a predetermined length, and closing date, often called the loan term. You know the amount of your monthly payments and how long you need to make those payments. If you need to borrow more money, you’ll fill out another application.</p>
<h2>Examples of Revolving Credit and Installment Credit</h2>
<p><img alt=”Revolving Credit vs. Installment Credit” src=”/Portals/0/Images/blog/credit/installment-loans-vs-line-of-credit-examples.png” style=”width: 738px” /></p>
<h2>Advantages of Revolving Credit</h2>
<p>A revolving line of credit has pros and cons that need to be considered. Here’s how it stacks up against installment credit.</p>
<h3>Flexible Borrowing</h3>
<p>You get the maximum amount available whenever you need it. Even if you don’t need it right now, you’ll have a piece of mind. There’s no need to go through a lengthy approval process if you need extra cash. You use what you need at the time.</p>
<h3>Covers Financial Rough Spots</h3>
<p>Even if you have a good credit score, your cash flow can be uneven. Suppose you are a salesperson who sells cars and only makes money from a handful of sales a year. A line of credit will help you keep current on your financial obligations during the months when your cash flow is low.</p>
<p>You also might make most of your money during the last fiscal quarter if you own a seasonal business. Your revolving credit line will allow you to hire needed staff, knowing that you’ll meet the added costs later.</p>
<h3>Secure Financing Option</h3>
<p>If you need a lower interest rate, you could apply for a secured line of credit option. You can use types of collateral to secure your revolving credit. Here are some examples:</p>
<ul>
<li>Real estate</li>
<li>Equipment</li>
<li>Vehicles</li>
<li><a href=”/blog-news/what-is-a-portfolio-line-of-credit.aspx” rel=”noopener” target=”_blank”>Stock portfolio</a></li>
<li>Other valuable assets</li>
</ul>
<h3>Repayment Flexibility</h3>
<p>You’ll have the flexibility to decide how and when your credit line is repaid. Citing the example of the seasonal business, after your busy season, you have plenty of cash on hand. You can postpone repayment until your cash flow supports it.</p>
<h2>Disadvantages of Revolving Line of Credit</h2>
<h3>Higher Interest Rates</h3>
<p>Because revolving lines of credit are flexible, lenders consider them to carry more risk. Because of this, you’ll likely encounter higher interest rates than installment credit. If you’re looking to make a large purchase, <a href=”/installment-loans.aspx” rel=”noopener” target=”_blank”>consider an installment loan</a> instead.</p>
<h3>Temptation</h3>
<p>Americans overspend when they have revolving credit. Check out these <a href=”https://www.valuepenguin.com/average-credit-card-debt” rel=”noopener” target=”_blank”>credit card debt stats</a>. There is also a tendency to pay the minimum amount every month because it is so small, spending a considerable amount on interest over time.</p>
<h3>Lower Credit Limits</h3>
<p>As mentioned above, revolving credit is considered higher risk leading lenders to approve you for lower credit limits. If you need substantial financing, this line of credit option is not for you.</p>
<h3>Unexpected Adjustable Terms</h3>
<p>The terms of use for revolving lines of credit, including your interest rate, can change with little notice. You won’t have to accept any new terms, but any new terms legally bind you if you continue to use that credit. Unfortunately, your only option to not accept those new terms is to pay your full balance and cancel that credit line.</p>
<h2>Advantages of Installment Credit</h2>
<p><a href=”/blog-news/advantages-installment-loans.aspx” rel=”noopener” target=”_blank”>Installment credit has pros and cons</a> that you need to consider. Here’s how it stacks up against a revolving line of credit.</p>
<h3>Predictable Payments</h3>
<p>Monthly payments set at the same amount provide predictability for your budget. Compared to revolving credit, Installment credit has a fixed term, interest rate, and in most cases, the same monthly payment.</p>
<h3>Larger Loan limits</h3>
<p>Because lenders consider this type of credit less risky, you’ll be able to access higher loan limits than with revolving credit if you can meet the requirements. Of course, it doesn’t mean that you won’t be able to apply for a smaller loan amount. You can get a loan for a few thousand dollars if that’s all you need.</p>
<h3>Lower Borrowing Costs</h3>
<p>In terms of interest rates, installment credit can be less expensive. Lenders offer lower interest rates which will cost less over time. Some people use installment credit to pay off their revolving credit when the interest rate is lower.</p>
<h3>Make Large Purchases</h3>
<p>One of the common features of installment credit is its versatility. Once approved, you can use it to pay for a major purchase, such as a car. You can also use it to purchase a home and pay later in small amounts for 15 to 30 years.</p>
<h2>Disadvantages of Installment Credit</h2>
<h3>Tough to Qualify</h3>
<p>Because of the lower interest rates, lenders have more stringent requirements for you to qualify. They will consider your income, credit history, and other outstanding debt. Most revolving credit lines tend to be more lenient in their lending practices, particularly for higher-risk borrowers.</p>
<h3>Prepayment Penalties</h3>
<p>Some lending agreements will not allow you to pay off your credit line early, so you must read the fine print. You can be charged a substantial fee for paying more than the required amount each month or settle the debt entirely.</p>
<h3>Double Dipping</h3>
<p>As mentioned before, you can use installment credit to pay off your revolving credit if you find a lower interest rate. But, you have to commit not to use your revolving credit. Running up new balances and the monthly payments required by your installment credit will put additional pressure on your budget.</p>
<h3>Locked Terms</h3>
<p>Because the terms of your installment credit are determined before you close, you will not be able to renegotiate. The payment schedule, interest rate, and terms are set in stone. If your financial situation changes or your credit improves, you will have to refinance to get a better interest rate.</p>
<h2>How Can You Build Credit With Installment and Revolving Credit?</h2>
<p>How you <a href=”/blog-news/how-to-use-your-line-of-credit.aspx” rel=”noopener” target=”_blank”>use lines of credit</a> can certainly hurt your credit score if it is not used wisely, but it can be great for your score if you manage both your credit mix and your credit utilization. Follow these tips to improve and <a href=”/blog-news/credit-repair-improve-credit-fast.aspx” rel=”noopener” target=”_blank”>build your credit fast. </a></p>
<p><strong>Don’t spend it all at once:</strong> How you manage your credit balance is a significant portion of your <a href=”/blog-news/what-credit-score.aspx” rel=”noopener” target=”_blank”>credit score</a>. Your credit utilization ratio, how much you owe compared to your credit balance, is 30% of your FICO score. Keep your ratio below one-third of your limit, and your credit will improve.</p>
<p><strong>Pay bills on time:</strong> Make all your monthly payments on time because your payment history is the biggest factor in your credit score. If you miss any payments, your score will reduce significantly.</p>
<p><strong>Use different types of credit:</strong> Lenders feel more confident if you show them that you can manage different kinds of credit. Having both installment and revolving credit will benefit your credit score.</p>
<p><strong>Do not open too many accounts at once:</strong> Having different credit types is a benefit, but you do not want to open all of them at once. Be careful not to open too many accounts within a few months or even a year. The best strategy is to build credit steadily over time.</p>
<p><strong>Continue using your credit:</strong> Your score will increase if you use credit over an extended period.</p>
<h2>Make Educated Decisions About Your Credit</h2>
<p>Knowing the difference between revolving and installment credit allows you to make better financial decisions. Many borrowing options are available, whether your goal is to save money on interest, get through tough times, build your credit, or pay off your debt. But, before you apply for any credit, keep in mind how it will affect you. Doing so will allow you to manage your finances and set you up for success.</p>
<p>There are various <a href=”/blog-news/types-of-lines-of-credit.aspx” rel=”noopener” target=”_blank”>types of lines of credit</a> to cater to different requirements of different borrowers. Some fall under the secured category, and the rest are under unsecured. Out of all the lines of credit, a Portfolio Line of Credit is probably a lesser-known type that you should know about.</p>
<p>While each type of credit line has its characteristics, let us explore the basics of this article’s portfolio line of credit.</p>
<h2>What Is the Definition of a Portfolio Line of Credit?</h2>
<p>A portfolio line of credit, also known as securities-backed lending, is a <a href=”/blog-news/what-secured-line-credit.aspx” rel=”noopener” target=”_blank”>secured credit line</a> that uses your stock portfolio as collateral. This means you can borrow funds based on the value of your portfolio containing stocks or bonds. Usually, a portfolio line of credit lender approves a loan against a certain percentage of your securities, anywhere from 50% to 95%, and uses that portion as collateral. The funds you borrow from this type of securities-based lending can be used for almost any purpose except for buying or trading securities.</p>
<p>Talking about repayments, a portfolio line of credit works just like any other line of credit where you can make monthly payments or choose to pay the entire balance. You might be charged extra when the value of your portfolio reduces and falls below the level of the line of credit. The best thing about this type of line of credit is that you can not only borrow funds but also keep your long-term investments in securities intact while using them as collateral.</p>
<h2>How Does a Portfolio Line of Credit Work?</h2>
<ol>
<li>Find a Portfolio Line of Credit Lender and inquire how to apply. You may be asked to fill out the application form with your basic information and loan requirements.</li>
<li>The lender will determine your eligibility for getting the loan based on your investment portfolio or underlying assets.</li>
<li>Once approved, the lender takes over your securities and becomes a lienholder. This allows the lender to seize and possibly sell your securities in case of any default in payments.</li>
<li>You get ongoing access to funds up to a specific limit and period. As a portfolio line of credit borrower, you can choose to repay some or all of the outstanding loan balance.</li>
</ol>
<h2>What are the Pros & Cons of Portfolio Lines of Credit?</h2>
<h3>Pros</h3>
<ul>
<li>The interest rate of portfolio lines of credit is comparatively lower than that of credit cards and traditional bank loans due to their secured nature.</li>
<li>It offers flexible repayment terms and could provide you relaxation from making any payments when you choose not to borrow funds.</li>
<li>A portfolio line of credit is a safe lending option for lenders due to the use of collateral.</li>
<li>Finally, this type of line of credit can save you from paying hefty capital gain taxes if you were to dissolve some of your investments to get extra funds.</li>
</ul>
<h3>Cons</h3>
<ul>
<li>The most significant disadvantage of a portfolio line of credit is the market’s volatility. When the market goes down, the value of your portfolio might also go down. If this happens, your lender can ask you to provide additional collateral in the form of stocks, bonds, or cash.</li>
<li>Like any other type of <a href=”/blog-news/secured-loan-definition.aspx” rel=”noopener” target=”_blank”>secured credit</a>, there is a risk of losing your assets if you default on a portfolio line of credit.</li>
</ul>
<h2>How are Portfolio Lines of Credit and Personal Lines of Credit Different?</h2>
<p>If you have a strong portfolio, you might be intrigued by the portfolio line of credit. However, knowing the difference between this securities-backed line of credit and the commonly used <a href=”/blog-news/what-is-an-unsecured-line-of-credit.aspx” rel=”noopener” target=”_blank”>unsecured line of credit</a> can help you determine what is right for you!</p>
<table border=”1″ cellpadding=”0″ cellspacing=”0″ width=”100%”>
<tbody>
</tbody>
<thead style=”background-color: #24A64A; color: #fff;”>
<tr>
<th style=”width: 30%; text-align: left; vertical-align: top;”>Factors</th>
<th style=”width: 35%; text-align: left; vertical-align: top;”>Portfolio Line of Credit</th>
<th style=”width: 35%; text-align: left; vertical-align: top;”>Personal Line of Credit</th>
</tr>
</thead>
<tbody>
<tr>
<td style=”width: 30%; text-align: left; vertical-align: top;”>Collateral</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>Uses specific percentage of your portfolio’s value as collateral</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>Doesn™t require collateral</td>
</tr>
<tr>
<td style=”width: 30%; text-align: left; vertical-align: top;”>Credit limit</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>Usually ranges from 50% to 95% of the collateral’s market value</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>Maximum amount you are approved depends on the lender™s requirements and state where you live</td>
</tr>
<tr>
<td style=”width: 30%; text-align: left; vertical-align: top;”>Effect of market decline</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>You can be asked for additional collateral if the value of the pledged assets drops</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>None</td>
</tr>
</tbody>
</table>
<p> </p>
<h2>CASH 1’s Line of Credit Option</h2>
<p>A portfolio line of credit has its own set of advantages and disadvantages, but if you need continuous access to funds and don’t have a portfolio, CASH 1 can help you get a line of credit. You can be approved for a credit limit of $2,500 if you reside in <a href=”/personal-line-of-credit-loans/utah.aspx” rel=”noopener” target=”_blank”>Utah</a>, <a href=”/personal-line-of-credit-loans/idaho.aspx” rel=”noopener” target=”_blank”>Idaho</a>, <a href=”/personal-line-of-credit-loans/kansas.aspx” rel=”noopener” target=”_blank”>Kansas</a>, or <a href=”/personal-line-of-credit-loans/missouri.aspx” rel=”noopener” target=”_blank”>Missouri</a>. You can use the funds for almost anything, both for your personal and business needs.</p>
<p>You are probably aware that credit checks or ‘pulls’ are mainly of two kinds- hard and soft. Each of them is performed to serve different purposes under different situations and have a varying effect on your credit score. Although hard credit checks are a bit more complicated, let’s first learn every minute detail about a soft credit check, how it works, and its impact on your credit.</p>
<h2>What Is a Soft Credit Check?</h2>
<p>A soft credit check, also known as a soft inquiry or soft credit pull, is a type of inquiry into your credit report initiated by an interested party or you. These checks are relatively random and for a more general purpose. Moreover, anyone can run these soft credit checks without your permission or even knowledge.</p>
<p>Here are some examples of who can perform a soft credit check and when:</p>
<ol>
<li><strong>You:</strong> to check your credit score and report by yourself</li>
<li><strong>Insurance companies:</strong> to assess the risk</li>
<li><strong>Potential Employers:</strong> as part of your <a href=”/blog-news/why-employers-do-credit-check-employment.aspx” rel=”noopener” target=”_blank”>background checks</a></li>
<li><strong>Credit card issuers:</strong> for issuing preapproval offers</li>
<li><strong>Credit monitoring services:</strong> to track signs of identity theft</li>
<li><strong>Creditors:</strong> to help determine the likelihood of being paid back</li>
<li><strong>Landlords:</strong> to make sure that a prospective tenant is trustworthy</li>
</ol>
<h2>How Does a Soft Credit Check Work?</h2>
<p>Soft pulls help all the above-mentioned interested parties get the required information to make an informed decision. Your credit information will never be shared or made available to the public without any purpose or authority.</p>
<p>Now that you know who can perform a soft pull on your credit report, you might be interested in learning the different ways through which one can do so. If you wish to check your credit report, you can do it by checking your score or getting a copy of your report. This process is free and accessed from a government-authorized website <a href=”https://www.annualcreditreport.com/index.action” rel=”noopener” target=”_blank”>AnnualCreditReport.com</a>. In addition, you can legally request and receive one report from each of the credit bureaus in a year.</p>
<p>There are genuine personal finance websites that can also assist you in checking your credit score or report and are not considered hard inquiries. Even credit card companies offer free credit score assessments that are considered soft inquiries. The reports from these assessments can provide you with information relating to your credit every month.</p>
<h2>What Are the Benefits of a Soft Credit Check?</h2>
<p>With nearly no disadvantages, a soft inquiry can help you in improving your financial condition in many ways:</p>
<ol>
<li>Soft pulls don’t hurt your credit score.</li>
<li>It allows you to regularly watch your credit reports to make sure your credit report is free from any errors. Substantial errors on your report can lower your credit score and, in turn, reduce the chances of getting approved for a loan.</li>
<li>A hard credit check will generally mean a rejection for people with bad credit. So when a bad credit lender runs a soft credit check, borrowers don’t have to worry about the impact of the inquiry on their credit score and still get a chance to be approved for the loan.</li>
<li>You can also check who is looking at your credit report to ensure no one is misusing your personal and financial information. Fortunately, if you see anything fishy, you can lock your data which will freeze your credit and restrict people from making soft and hard inquiries without your permission or action.</li>
</ol>
<h2>Will a Soft Credit Check Affect My Credit Score?</h2>
<p>Absolutely no! A soft credit check is considered a relatively lenient way of pulling your credit report out of the two types of credit inquiries. It neither impacts your credit score nor appears on your credit report. The soft pulls will only appear on your version of the credit report, and nobody else will be able to view them.</p>
<p>On the other hand, every hard inquiry is reflected on your credit report and affects your score negatively. A high number of hard inquiries could portray you as a risk to the potential lender. Since soft credit checks are not associated with lending decisions, they may not negatively impact even if they are reflected on the report. However, a soft pull will only give you some basic information on your credit and not provide details of any defaults or late payment records.</p>
<p>Some people get anxious when they hear about credit inquiries. It can be because they may not know the clear difference between hard and soft credit checks and their effects on credit score. Knowing that soft credit inquiries have no impact on their credit profile would help them breathe a sigh of relief.</p>
<h2>What’s the Difference Between a Soft Credit Check and a Hard Credit Check?</h2>
<p>Understanding the difference between hard and soft inquiries is essential to safeguard your credit and finances. Whether you are applying for a form of credit or need a house for rent, a credit check will be performed, and the differences listed below will tell you which one it will be. So now, let’s dive into the key differences between the two types of credit checks:</p>
<table border=”1″ cellpadding=”0″ cellspacing=”0″ width=”100%”>
<tbody>
</tbody>
<thead style=”background-color: #303283; color: #fff;”>
<tr>
<th style=”width: 30%; text-align: left; vertical-align: top;”>Factors</th>
<th style=”width: 35%; text-align: left; vertical-align: top;”>Soft Credit Check</th>
<th style=”width: 35%; text-align: left; vertical-align: top;”>Hard Credit Check</th>
</tr>
</thead>
<tbody>
<tr>
<td style=”width: 30%; text-align: left; vertical-align: top;”>Effect on your credit score</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>It does not affect your credit score and also is also not reflected on your credit report. Only you can see soft inquiries.</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>It lowers your credit score by a few points. Moreover, the effect stays on your credit report for two years.</td>
</tr>
<tr>
<td style=”width: 30%; text-align: left; vertical-align: top;”>When does it occur</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>Usually occurs when a potential employer checks your credit or credit card provider runs preapproval checks. A soft pull also occurs when you check your own credit.</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>It mainly occurs when you apply for a specific credit option like a mortgage or a personal or business loan.</td>
</tr>
<tr>
<td style=”width: 30%; text-align: left; vertical-align: top;”>Need for consent</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>It can be performed without your consent.</td>
<td style=”width: 35%; text-align: left; vertical-align: top;”>It always requires your written consent.</td>
</tr>
</tbody>
</table>
<p> </p>
<h2>Get a Loan with No Credit Checks at CASH 1</h2>
<p>If you’re worried about credit checks, CASH 1 offers you <a href=”/personal-loans/no-traditional-credit-check-loans.aspx” rel=”noopener” target=”_blank”>no traditional credit check loans</a> which are easy to qualify for. This is one of the best ways to get funds quickly, even with bad credit and without any risk of hurting your credit score further. When you apply for a CASH 1 loan, we don’t run any hard inquiry and consider factors other than your credit score to determine your ability to repay the loan. Bad credit lenders usually run soft pulls which don’t affect your credit and still allow you to qualify for a loan. Hence, understanding a soft credit check and how to get a free credit report can help you maintain and <a href=”/blog-news/how-improve-credit-score.aspx” rel=”noopener” target=”_blank”>improve your credit score</a>.</p>
<p>If you use the overdraft line of credit, you’ll pay interest on the amount you borrow. The interest you pay is often less expensive than a standard overdraft protection program, which could charge you up to $35 for each rejected transaction.</p>
<p>This article will help you understand how an overdraft line of credit works, how to get one, the pros and cons, and the alternatives, to help you know if you need one.</p>
<h2>How Does an Overdraft Line of Credit Work?</h2>
<p>With standard overdraft protection, if you don’t have money in your checking account and you make a few small purchases of $4, $12, and $7, you have now overdrawn a total of $28. If your bank charges three $35 overdraft coverage fees, you now owe $105 to cover $28 in purchases. When you have an overdraft line of credit, you borrow the $28 against that line of credit. The bank will charge you interest at a rate comparable to a credit card.</p>
<p>The next time your paycheck is deposited in your checking account, you can repay that loan. With a standard overdraft protection account, your interest charge could be less than $15 instead of $105.</p>
<h2>Should I Have an Overdraft Line of Credit?</h2>
<p>Not everyone needs overdraft protection, but if you’re new to having a checking account or you’re learning to manage your money responsibly, choosing this option could be beneficial.</p>
<h2>What Fees Can I Be Charged Without a Checking Line of Credit?</h2>
<p>Having a cushion of cash is a best practice for your checking account. But sometimes, you could make a mistake, or a forgotten bill can catch you off guard, and when you have an overdraft line of credit, you’re covered. If your checking account is empty and you don’t have a line of credit linked to your checking account, your penalties can wreak havoc on your budget. Here’s a list of penalties that you can incur without a checking line of credit.</p>
<h3>Debit card transactions</h3>
<p>If you never opted into an overdraft line of credit, your bank can deny any purchases or ATM withdrawals if your account has insufficient funds. You will not be charged non-sufficient funds (NSF) fees because banks do not charge NSF fees for your declined debit transactions. You’ll need to decide to use an alternate payment method or not make the purchase. However, if you opt for overdraft protection, you’ll avoid the embarrassment of having your transaction denied.</p>
<h3>Recurring monthly bills</h3>
<p>if you have preauthorized payments withdrawn by Automated Clearing House (ACH), they may be processed by your bank, even if your check account has no funds. Most likely, you will be charged overdraft fees, even if you didn’t opt in to overdraft protection. If your ACH transaction is returned unpaid, you’ll incur NSF fees. Not only will these cost you $35 for each transaction, but the company that didn’t receive your payment can charge you a fee as well.</p>
<h3>Checks</h3>
<p>If you write a check for more than your checking balance, your bank or credit union might not allow the check to go through. If you have overdraft protection, your check amount will be covered up to your line of credit limit. If not, you may be charged overdraft fees even if your bank covers your check, or your bank may bounce your check, and you can still incur NSF fees, and the check recipient will charge you a bounced check fee as well.</p>
<h2>Can My Bank Enroll Me in Overdraft Protection Automatically?</h2>
<p>No. The <a href=”https://www.congress.gov/bill/117th-congress/house-bill/4277″ rel=”noopener” target=”_blank”>Overdraft Protection Act</a> keeps your bank from automatically enrolling you in an overdraft line of credit. You’ll need to request the service.</p>
<h2>How Can I Avoid Overdraft Fees?</h2>
<p>Like most businesses, the banking industry is focused on making money, and a simple way of doing that is by charging you various fees. Some fees may be unavoidable, but you can avoid most by following these steps.</p>
<ul>
<li>Monitor your account online daily for any unusual activity or spending.</li>
<li>Sign up for account alerts via your email or text.</li>
<li>Link your checking account to a savings account or line of credit so your bank will transfer money to prevent any bounced checks.</li>
<li>Pay with cash and avoid forgetting any debit charge or check you wrote.</li>
<li>Use direct deposit to have access to your paycheck quicker.</li>
</ul>
<p>Before you sign up for a checking account, you need to research a bank’s policy on fees. Some banks waive overdraft fees if you deposit the overdrawn amount in 24 hours.</p>
<p>Keep in mind that if you are charged a fee to your account, call your bank’s customer service and ask them to waive your fee. It’s worth a shot.</p>
<h2>How Do I Get an Overdraft Line of Credit?</h2>
<p>It’s a simple and inexpensive safeguard to add overdraft protection to your checking account. You’ll need to contact your bank or credit union to sign up. You may be able to apply online or over the phone. Be sure to research all the fees that you can incur. Once you have the checking line of credit connected to your checking account, use it as little as possible. Keep your line of credit at a manageable amount and your transfer fees and interest charges low.</p>
<h2>What Are the Benefits of an Overdraft Line of Credit?</h2>
<ul>
<li>Paying an overdraft fee cost will you substantially more.</li>
<li>Access to funds that assist you every day or during financial emergencies.</li>
<li>If you bounce a check, it will clear and help you avoid returned check fees from merchants.</li>
<li>You can qualify for credit limits between $500 to $1,000 or more.</li>
<li>Avoid embarrassment and guarantee your transaction will be processed even if your account doesn’t have enough money.</li>
<li>You can get competitive rates based on your account history or credit history.</li>
</ul>
<h2>What Are the Drawbacks of an Overdraft Line of Credit?</h2>
<p>It is true that a line of credit attached to your checking account is less expensive than none at all and that it allows you to spend in emergencies. But it would help if you didn’t depend on this form of overdraft protection for these reasons:</p>
<ul>
<li>You could consider a checking line of credit similar to a credit card. If you overspend and depend too much on your credit line, you could end up not being able to afford the charges.</li>
<li>Depending on the fine print, your bank could assess a fee for every overdraft transfer and pay for multiple fees in a single day.</li>
<li>Your overdraft line of credit is inexpensive, but it’s not free. You will pay interest on the money you borrow, and the cost could add up over time.</li>
<li>Your financial institution could restrict how times you use your overdraft line of credit and cut you off if you use it too often.</li>
</ul>
<h2>What Are My Alternatives to a Checking Line of Credit?</h2>
<p>If you feel that you may not be ready for an overdraft line of credit, you can consider these options:</p>
<h3>Don’t opt-in</h3>
<p>If you don’t choose to sign up for the protection, your bank will reject your transactions from your debit card. You won’t overdraw your account if you’re not allowed to spend more than you have.</p>
<h3>Auto transfer from savings</h3>
<p>Your bank could allow you to link your savings account to your checking account. Instead of borrowing from your financial institution, you use your cash from your savings account. Be aware of any fees that may occur from this type of transfer.</p>
<h3>Link a credit card</h3>
<p>If you have a credit card, you could use it to cover any overdrafts that may occur. You’ll still owe interest on the amount you borrow, but it will be cheaper than a $35 NSF fee.</p>
<h3>Find another bank</h3>
<p>If you feel you’re being charged too much, it never hurts to shop around online and research other financial institutions.</p>
<h2>Does an Overdraft Line of Credit Affect Credit Score?</h2>
<p>If your financial institution sends your overdraft line of credit to collections, it will hurt your credit. Once a collection agency creates an account for you, it can go on your credit report as delinquency and remain there for seven years. Be sure to pay off your overdrawn balance with any fees to avoid this issue.</p>
<p>Avoiding collections educating yourself about the factors <a href=”/blog-news/credit-repair-what-hurts-your-credit-score.aspx” rel=”noopener” target=”_blank”>that hurt your credit score</a> will guarantee healthy finances.</p>
<ul>
<li><bold>Your payment history</bold> is the most significant part of your credit score. If you miss or make any late payments, your score will be negatively affected.</li>
<li><bold>Your credit utilization</bold> should not exceed 30% of your available credit at any time.</li>
<li><bold>Your mix of credit</bold> account types needs to be diverse with <a href=”/installment-loans.aspx” rel=”noopener” target=”_blank”>installment loans</a>, <a href=”/personal-line-of-credit-loans.aspx” rel=”noopener” target=”_blank”>lines of credit</a>, and <a href=”/blog-news/what-is-revolving-credit.aspx” rel=”noopener” target=”_blank”>revolving lines of credit</a>.</li>
<li>Hard inquiries that appear on your credit report can temporarily ding your score, especially if you have many in a short time.</li>
<li><bold>Negative information</bold> like foreclosures, charge-offs, debts, and bankruptcies will bring your credit score down.</li>
</ul>
<p>Although you can use a credit line for pretty much any purpose, it doesn’t make sense to use it to finance your holiday. Doing this will only eat away a big chunk of your credit limit, which you could use during any financial emergency or support a significant purchase. Therefore, like any other form of credit, a line of credit can only benefit you if you know how to use it responsibly. We’ve put together seven tips to make wise use of your line of credit and help you <a href=”/blog-news/how-to-build-credit.aspx” rel=”noopener” target=”_blank”>build good credit</a>:</p>
<h2>Use When You Don’t Know The Exact Amounts</h2>
<p>Some expenses come out of nowhere. Though you know that you’ll have to face them someday or the other, they might come uninvited and ruin your budget. For instance, significant home repairs are inevitable, and you may not be prepared for them when they suddenly pop up. This is when you can use a line of credit only and only if you don’t have an <a href=”/blog-news/how-to-build-an-emergency-fund.aspx” rel=”noopener” target=”_blank”>emergency fund</a> to take care of such expenses.</p>
<p>Yes, it’s better to save your line of credit for extremely urgent times when you can’t wait to fill out another loan application. The flexibility of a line of credit makes it one of the <a href=”/blog-news/types-of-lines-of-credit.aspx” rel=” noopener” target=”_blank”>best forms of credit</a> to use when you don’t know when and how much money you may need at any point of time in your life.</p>
<h2>Know the Two Phases of Your Line Of Credit</h2>
<p>Usually, a line of credit has a draw period and a repayment period. You can check your credit line agreement to know when the draw period ends, and your credit line goes into the repayment period. You can borrow funds multiple times within the credit limit allocated by your lender during the draw period. Although it’s named the draw period, you have to make minimum payments to replenish your credit limit to borrow again.</p>
<p>When you reach the repayment period, you can no longer withdraw any funds but will have to continue making monthly payments until you repay the outstanding balance in full. You may invite financial trouble if you fail to make payments during the draw period or the repayment period.</p>
<h2>Prefer Using Less Than 30% of Your Credit Limit</h2>
<p>The percentage of credit limit you use from your line of credit can significantly influence your <a href=”/blog-news/what-credit-score.aspx” rel=”noopener” target=”_blank”>credit score</a>. You may see a drop in your credit score if you utilize more than 30% of your entire line of credit. This implies borrowers should use less than 30 percent of their credit limit to avoid hurting their credit score. By regulating your withdrawals and making timely payments, you can maintain a good credit score.</p>
<p>For example, your total credit limit is $10,000, and you withdraw $2,000. This means you’re using 20% of your credit limit, which won’t hurt your credit score. But if you have a credit limit of $4,000, drawing $2,000 would mean using 60%, <a href=”/blog-news/credit-repair-what-hurts-your-credit-score.aspx” rel=”noopener” target=”_blank”>negatively affecting your credit score</a>. Essentially, you should draw money based on your need, income, and repayment ability.</p>
<h3>If you have a $2,000 balance:</h3>
<p><img alt=”Differences between secured and unsecured closed-end credit” src=”/portals/0/Images/blog/credit/How-to-use-credit.svg” style=”width: 738px” /></p>
<h2>Don’t Request for a Line Of Credit Limit Increase</h2>
<p>If you are planning to request an increase in your credit limit, it’s better to hold back. Demanding a hike in your credit limit might hurt your credit score. Most lenders initiate hard inquiries when you ask for an increase in your line of credit limit, and hence you may see a fall in your score.</p>
<p>There are other ways that you can adopt to extend your credit limit. In some cases, you can be eligible for a higher credit limit if your income has increased. One promising way to automatically increase your credit limit is by perpetually making repayments on time. You can gain your lender’s trust and be awarded an increased credit limit for being one of their loyal and trusted borrowers. On the contrary, failing to pay your outstanding balances on time can reduce your line of credit limit and subsequently reduce your creditworthiness.</p>
<h2>Use as an Alternative to a Credit Card</h2>
<p>If you need funds to pay for an unexpected bill before your payday, you can use a line of credit. It’s a more convenient option than a credit card. This makes a line of credit a comparatively affordable borrowing option for those already struggling on a tight budget. You can save money on interest by choosing a <a href=”/blog-news/line-of-credit-vs-credit-card.aspx” rel=”noopener” target=”_blank”>line of credit over a credit card</a> on certain occasions. With the flexible repayment option that most lines of credit lenders provide, you can repay the borrowed cash with ease and get continuous access to funds whenever needed.</p>
<h2>Don’t use for Paying off a Mortgage</h2>
<p>Using a personal line of credit is not an appropriate option to pay off your mortgage, especially when your line of credit is an <a href=”/blog-news/what-is-an-unsecured-line-of-credit.aspx” rel=”noopener” target=”_blank”>unsecured</a> one with a lower credit limit. Mortgages are usually of large amounts, and using up a more significant share of your line of credit for them could put your financial situation in trouble. If you’re not happy with your current mortgage terms, you could choose to refinance your mortgage instead of using your line of credit.</p>
<h2>Avoid Making Down Payments</h2>
<p>Withdrawing funds from your line of credit to make a down payment may not be approved by your mortgage lenders. Your mortgage lender checks your debt-to-income ratio to determine your ability to make your mortgage payments. Using funds from your credit line would increase your debt while your income remains constant. An increase in the debt-to-income ratio indicates you as a risky borrower. Hence, avoid using your line of credit to make down payments.</p>
<p>CASH 1 offers a personal line of credit with minimum requirements. If you get approved, you can easily borrow funds whenever you are short on funds. You need to know when is a good time to use your credit line and rely on other available sources of funds. Adopting these tips and using your line of credit wisely can keep you from being strapped for cash.</p>
<p>Unlike an installment loan, you can borrow a line of credit at any time within the maximum credit limit and repay the loan to help you borrow again when emergencies come your way. This way, you can avoid borrowing more than you need, saving the interest which you would have incurred had you pulled out your entire line of credit loan.</p>
<p>Now, you will find both secured and unsecured forms of a line of credit. With an unsecured line of credit, you can be ready for any unexpected expense without the risk of losing your asset or property. While a <a href=”/blog-news/what-secured-line-credit.aspx” rel=”noopener” target=”_blank”>secured line of credit</a> also comes with its own set of benefits, we’re here to tell you everything you need to know about an unsecured personal line of credit to make your financial life more manageable.</p>
<h2>What is an Unsecured Line of Credit?</h2>
<p>When we talk about an unsecured line of credit, the best example that comes to our mind is credit cards which are not guaranteed by any asset. In simple words, an unsecured line of credit is a flexible financing option that doesn’t require collateral security and allows you to withdraw money multiple times when needed within your approved limit. This means you won’t have to fill out a new application every time you need to borrow funds from your unsecured line of credit balance. By making minimum payments or paying off your entire outstanding credit card balances at the end of each month, you can restore your credit limit to help you make as many withdrawals as you like.</p>
<p>You would be wondering if an unsecured line of credit does not require any collateral to be approved, then what do lenders check when you apply for this loan. Usually, lenders approve your line of credit loan and provide a credit limit based on your ability to repay. Some lenders check your credit score, and some offer an unsecured personal line of credit even with a poor credit history. Once you get approved, you can enjoy quick access to funds on an ongoing basis.</p>
<h2>What are the Pros and Cons of Unsecured Lines of Credit?</h2>
<p>There are various advantages and disadvantages to choosing an unsecured line of credit. You can make your decision of applying for our personal line of credit by carefully weighing the below pros and cons:</p>
<h3>Pros</h3>
<ul style=”margin-left: 25px;”>
<li>You don’t need to own or pledge any assets as collateral to secure the loan.</li>
<li>This is considered a quick and convenient way to meet fluctuating cash needs.</li>
<li>An unsecured line of credit comes with flexible payment options and affordable interest rates.</li>
<li>These loans often don’t have a term limit or end date and fall under an <a href=”/blog-news/types-of-lines-of-credit.aspx” rel=”noopener” target=”_blank”>open-ended credit</a> category.</li>
</ul>
<h3>Cons</h3>
<ul style=”margin-left: 25px;”>
<li>It would be best if you had good credit to qualify for an unsecured line of credit.</li>
<li>They offer comparatively lower borrowing limits which may not work best to pay for significant, one-time expenses.</li>
<li>Such credit options are riskier for lenders due to the absence of collateral, and therefore, the interest rates tend to be a little higher.</li>
</ul>
<h2>When Should I Choose an Unsecured Line of Credit?</h2>
<p>Although you can use the funds you borrow using an unsecured personal line of credit for any purpose, you won’t be able to use it for expenses exceeding the credit limit. For instance, you can use this type of credit line to finance your home repairs or renovation but not for purchasing your house. You can pay for the unexpected expense immediately with a personal line of credit and spread the cost over several months by scheduling your payments.</p>
<p>Unlike an <a href=”/installment-loans.aspx” rel=”noopener” target=”_blank”>installment loan</a>, you can apply for a line of credit once and withdraw cash multiple times as you need it. This feature makes them ideal for financial emergencies when you don’t have time to complete the entire loan application process. So clearly, you can choose an unsecured line of credit depending on the purpose of borrowing and the amount of funds you require.</p>
<p>All in all, you can turn using an unsecured line of credit into an excellent lending option if you know when exactly they work best.</p>
<h2>How Closed-End Credit Works</h2>
<p>You and your lender agree to the amount you need to borrow, the monthly payment, and the interest rate. These factors are dependent on your credit rating. Getting closed-end credit is an excellent way to <a href=”/blog-news/how-to-build-credit.aspx” rel=”noopener” target=”_blank”>build your credit</a> by demonstrating to lenders that you can borrow responsibly.</p>
<p>You can use close-end credit if you’re looking to make an expensive purchase and pay for it over time.</p>
<p>Many lending institutions define closed-end credit as <a href=”/blog-news/secured-loan-definition.aspx” rel=”noopener” target=”_blank”>secured loans</a> or <a href=”/installment-loans.aspx” rel=”noopener” target=”_blank”>installment loans</a>. Online lenders, credit unions, and banks offer a closed-end lending option.</p>
<p>As mentioned before, auto loans and real estate are examples of closed-end credit. Sometimes referred to as <a href=”/blog-news/what-is-revolving-credit.aspx” rel=”noopener” target=”_blank”>revolving credit lines</a>, credit cards and home equity lines of credit (HELOC) are open-end credit. The main <a href=”/blog-news/closed-end-vs-open-end-credit.aspx” rel=”noopener” target=”_blank”>difference between open-credit and closed-end credit</a> is the debt and how you repay it.</p>
<p>Closed-end credit is issued to you for a particular purpose and must be paid within a set period. At the end of the agreed term, you must pay the entire balance, including interest and any maintenance fees. Closed-end credit does not offer any available credit or revolve, and you cannot modify the terms.</p>
<p>The monthly payments and interest rate are fixed. However, the interest rates can vary between lenders. Closed-end credit interest rates are generally lower than open-end credit. The interest accrues every day on your outstanding balance. Most closed-end credit loans have fixed interest rates; a mortgage loan can offer a fixed or variable rate.</p>
<p>If you’re looking to be approved for closed-end credit, you need to inform the lender of the purpose of the loan. You also may be asked to have a down payment.</p>
<div style=”text-align; margin: 0 auto; width: 300px;”><img alt=”Differences between secured and unsecured closed-end credit” src=”/portals/0/Images/blog/credit/secured-vs-unsecured-closed-end-credit.svg” /></div>
<h2>Secured vs. Unsecured Closed-End Credit Accounts</h2>
<p>Closed-end credit can be either unsecured or secured. Unsecured closed-end credit does not require collateral if you meet the lender’s credit requirements and agree to repay the loan on time with interest. Because no collateral is needed, your credit score will need to be at least in good standing for you to qualify.</p>
<p>On the other hand, secured closed-end credit requires you to use collateral that the lender could possess if you default on your loan terms. You may opt to use collateral because you’d need a higher loan amount, or your credit score doesn’t allow you to be approved for unsecured closed-end credit. Using secured closed-end credit can improve your chances to be approved, lower your interest rate, and increase your borrowing amount.</p>
<h2>Common Examples of Closed-End Credit</h2>
<h3>Smartphone Financing</h3>
<div style=”text-align; margin: 0 auto; width: 300px;”><img alt=”Smartphone financing is an example of closed-end credit” src=”/portals/0/Images/blog/credit/examples-of-closed-end-credit-smartphone-loans.svg” /></div>
<p>You can find smartphone financing at retail stores that sell cellphones or through cellphone service providers. Most providers allow you to pay off your devices in installments with no interest or finance charges. You’ll most likely need a two-year contract to take advantage of this benefit, and an upgrade fee also applies.</p>
<p>If you’re not going to switch to another cellphone company any time soon, then this option is for you. If you decide to break your contract, you could be required to pay a fee – Or pay off the balance that you owe.</p>
<div style=”text-align; margin: 0 auto; width: 300px;”><img alt=”In-store financing is an example of closed-end credit” src=”/portals/0/Images/blog/credit/examples-of-closed-end-credit-in-store-financing.svg” /></div>
<h3>In-Store Financing</h3>
<p>Furniture stores and online retailers offer closed-end credit. You can walk into a store or apply online by filling out a quick application. Once you’re approved, you’ll have a fixed interest rate with weekly, monthly, or bimonthly payments. You’ll get your furniture delivered, and you make payments until your furniture, computer, appliance, or mattress is paid off with interest.</p>
<div style=”text-align; margin: 0 auto; width: 300px;”><img alt=”Car loans are an example of closed-end credit” src=”/portals/0/Images/blog/credit/examples-of-closed-end-credit-car-loans.svg” /></div>
<h3>Car Loans</h3>
<p>Using closed-end credit to make larger purchases is why you would get a car loan. Auto lenders check if your income can afford the monthly payments, your employment history if you’ve had a previous car loan, your credit scores, and your history.</p>
<p>Your interest rate will depend on your credit score, the loan length, the size of your down payment, and the vehicle you choose. If you have a loan and make your payments on time and your credit score rises, you could refinance your car loan to get smaller payments and get a better rate.</p>
<div style=”text-align; margin: 0 auto; width: 300px;”><img alt=”Education loans are an example of closed-end credit” src=”/portals/0/Images/blog/credit/examples-of-closed-end-credit-education-loans.svg” /></div>
<h3>Education Loans</h3>
<p>Paying for your education is another example of closed-end credit. If you apply for financial aid, be sure to understand where you get the loan from and the terms and conditions. Student loans can come from banks, financial institutions, or the federal government. Federal Student Loans sometimes have better benefits than loans from private sources and banks.</p>
<div style=”text-align; margin: 0 auto; width: 300px;”><img alt=”Mortgages are an example of closed-end credit” src=”/portals/0/Images/blog/credit/examples-of-closed-end-credit-mortgage.svg” /></div>
<h3>Mortgage</h3>
<p>A mortgage loan is probably the most extensive closed-end credit account you can acquire. You sign an agreement with a mortgage lender to lend you the money to buy a home because you don’t have the cash upfront. This agreement gives your lender legal rights to repossess your property if you fail to meet the requirements and terms of your mortgage. The process of failing to make payments and forfeiting your property to your lender is called foreclosure.</p>
<h2>Closed-End Credit Pros</h2>
<h3>Predictability</h3>
<p>The positive side of closed-end credit is it offers predictability and stability. With no annual fees and a fixed interest rate and term, you know how much your payment will be each month and can budget accordingly. And when you’ve finished paying it off, that debt is done with. These forms of credit are typically more straightforward and with fewer fees.</p>
<h3>Money All at Once</h3>
<p>A closed-end loan gives the borrower the entire loan amount upfront and requires them to pay it back over time in installments.</p>
<h3>Significant Purchases</h3>
<p>Ideal for making a big-ticket purchase, you can get a car, furniture, or a house using closed-end credit.</p>
<h3>Lower Interest Rate</h3>
<p>Closed-end credit usually has a lower interest rate than open-end credit. However, interest is charged on the entire principal amount.</p>
<h2>Closed-End Credit Cons</h2>
<h3>Not Flexible</h3>
<p>Closed-end credit is not very flexible. You have to determine how much funding you need before receiving it. You’ll need to refinance (at a cost) if you decide later that you need more money. It’s best to use this type of credit if you make a large, single, predictable purchase. If you have issues budgeting and making payment commitments – This type of loan is not for you.</p>
<h3>Maturity Date</h3>
<p>Closed-end credit has a maturity date, at which time the debt must be paid in full or refinanced. If you don’t have funds to pay at that time and don’t qualify to refinance, you’re in trouble.</p>
<h2>How to Get Approved for Closed-End Credit</h2>
<p>You can apply online for closed-end credit from an alternative lender, bank, cellphone provider, car dealership, department store, or credit union. Generally, you’ll need to use the money you’ve borrowed for a specific purpose. For instance, A <a href=”https://www.cash1loans.com/personal-loans.aspx” target=”_blank”>personal loan</a> is a type of closed-end credit you can use however you like. A car loan, by comparison, is a closed-end credit that must be used to purchase a vehicle.</p>
<p>Your lender will check your credit history before you’re approved. If your credit score is on the lower end, you may have to make a down payment. Your credit score will impact the interest rate you pay and the amount you can borrow.</p>
<div style=”text-align; margin: 0 auto; width: 300px;”><img alt=”Payment terms on closed-end credit” src=”/portals/0/Images/blog/credit/payment-terms-on-closed-end-credit.svg” /></div>
<h2>Payment Terms on Closed-End Credit</h2>
<p>Whenever you borrow money, you pay interest. The interest rate is typically fixed on your entire closed-end credit term. Although with certain mortgages, you could have a variable interest rate.</p>
<p>Closed-end credit is a better long-term borrowing option than open-end credit because it has a lower rate. You pay less overall with a lower interest rate.</p>
<p>Conversely, your monthly payment for closed-end credit is generally higher than open-end credit, even for the same amount. Because you have a fixed payment to make every month, you don’t have the flexibility to make a lower payment if you need.</p>
<p>If you make a late payment, your lender charges a late fee. Your lender will report to the credit bureaus if your payment is more than 30 days late. Depending on the terms, you could be considered default if your account becomes 30 to 90 days past due. At that point, you lose the option to make monthly payments because your lender will require the entire balance you owe.</p>
<h2>How Closed-End Credit Affects Your Credit</h2>
<p>10% of your FICO credit score depends on your credit mix. The more types of credit you have are considered much better than having a kind of credit. If you already have a credit card (open-end credit) and get approved for a personal loan (closed-end credit), you will help your credit score.</p>
<p>Closed-end credit affects your credit score the same way as other credit accounts. If your creditor reports your late payments, your score will drop. On the flip side, your on-time payments will help <a href=”/blog-news/boost-my-credit-score.aspx” rel=”noopener” target=”_blank”>boost your score</a>.</p>
<p>While you pay your account, your creditor sends monthly updates on your account status to the credit bureaus. Once you finish paying, your account closes and stays on your credit report for another ten years or more. Any unfavorable information associated with your account will fall off your credit report in seven years.</p>
<h2>Is Closed-End Credit Right For You?</h2>
<p>When you borrow any money, you need to consider that you can afford new debt honestly. If you are still unsure if closed-end credit is suitable for you, these points should help you decide.</p>
<ol>
<li>If you only need to borrow once and repay the funds over time, a closed-end credit is right for you.</li>
<li>Your payments are based on your credit rating, and if your credit is good, you may qualify for a lower interest rate and save money over time.</li>
<li>If you want to build your credit, obtaining closed-end credit will build your score if you make on-time payments.</li>
<li>Use closed-end credit if you need to purchase an expensive item like a vehicle, house, furniture, and more.</li>
</ol>
<p>So, let’s discuss the meaning of both open-end and closed-end credit and their differences to help you choose the right <a href=”/blog-news/types-of-lines-of-credit.aspx” rel=”noopener” target=”_blank”>type of credit</a>.</p>
<h2>What is an Open-End Credit?</h2>
<p>An open-end credit, also known as <a href=”/blog-news/what-is-revolving-credit.aspx” rel=”noopener” target=”_blank”>revolving credit</a>, is a type of credit that allows you to make repeated withdrawals when needed up to a certain limit. You have the option to pay back the previous amount withdrawn in full or make installment payments to restore your credit limit. The best part of open-end credit is that you pay interest on only the amount you use, helping you save money on the interest of the unused amount.</p>
<p>Unlike closed-end credit, an open-end credit can be used for your frequent and unexpected financial needs and not necessarily for a specific purpose. Credit cards are the best examples of open-end credit, mostly unsecured. On the other hand, a home equity line of credit (HELOC) is a secured type of open-end credit.</p>
<h2>What is Closed-End Credit?</h2>
<p>Closed-end credit is a lending option that allows you to borrow funds upfront and repay the entire amount with interest by the end of the borrowing term. The funds you apply for are disbursed all at once. It means you won’t be able to increase the principal amount or borrow any further at any point during the loan term after the disbursement of funds.</p>
<p>Most often, the term closed-end credit is used synonymously as <a href=”/installment-loans.aspx” rel=”noopener” target=”_blank”>installment loans</a>. The most common examples of closed-end credit are mortgages and auto loans, where the purpose of taking out a loan is known and definite. Although these loans usually have a specific purpose, a <a href=”https://www.cash1loans.com/personal-loans.aspx” target=”_blank”>personal loan</a> that you can borrow for any purpose also falls under the closed-end credit category.</p>
<h2>How Do Closed-End and Open-End Credit Differ?</h2>
<p>Every loan form has its characteristics and works differently. Closed-end and open-end credit are also significantly different from each other depending on various factors, which we’ve clearly shown in the table below:</p>
<table border=”1″ cellpadding=”10″ cellspacing=”0″>
<tbody>
<tr>
<td style=”text-align: left; font-weight: 700; line-height: 1.3;”>Differentiating Factors</td>
<td style=”text-align: left; font-weight: 700; line-height: 1.3;”>Closed-End Credit</td>
<td style=”text-align: left; font-weight: 700; line-height: 1.3;”>Open-End Credit</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>Ideal Use</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Ideal for making a big-ticket purchase.</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Ideal for short-term purchases and expenses.</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>Loan Disbursement</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>The entire amount of the loan is provided to the borrower upfront.</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>The borrower is allowed to make repeated withdrawals up to a certain limit.</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>Interest Rates</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Closed-end credit usually has a lower interest rate than open-end credit. However, interest is charged on the entire principal amount.</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Though you pay interest on only the amount you use, the interest rates tend to be higher as there is usually no collateral.</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>Repayments</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Generally, borrowers are given an option to make fixed and scheduled payments that comprise a portion of both the principal and interest until the loan is paid in full.</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Borrowers can pay the outstanding balance in full each month or make installment payments to maintain the pre-approved borrowing limit.</td>
</tr>
</tbody>
</table>
<p> </p>
<h2>How to Choose the Right Type of Credit</h2>
<p>There are two main factors that you should consider while choosing a particular type of credit, the need to borrow money and your ability to repay. When we talk about closed-end and open-end credit, both have different ways of making money available to you and repayments plans. While both types of credit can positively impact your credit score, failing to use them responsibly can damage your scores.</p>
<p>We purposely didn’t mention the pros and cons of closed-end and open-end credit as both the credit types are essential and work great under different financial situations. Since you can repeatedly borrow with the help of open-end credit like a credit card or <a href=”/personal-line-of-credit-loans.aspx” rel=”noopener” target=”_blank”>personal line of credit</a> loan, you can use it when there are multiple unexpected bills to be paid over some time. You can also deal with short-term financial emergencies with a credit card if you have just started to build your emergency fund.</p>
<p>For single and large purchases, you can rely on closed-end credit options. The amount you need to help finance a house or a car is enormous and choosing an installment loan instead of a credit card is much better. Once you decide on your credit type, make sure you read the terms and conditions carefully to avoid any unpleasant surprises.</p>
<h2>Closed-End and Open-End Credit Options at CASH 1</h2>
<p>Fortunately, we have something for everyone! If you find yourself in need of extra money now and then, we offer a personal line of credit in <a href=”/personal-line-of-credit-loans/utah.aspx” rel=”noopener” target=”_blank”>Utah</a>, <a href=”/personal-line-of-credit-loans/idaho.aspx” rel=”noopener” target=”_blank”>Idaho</a>, <a href=”/personal-line-of-credit-loans/kansas.aspx” rel=”noopener” target=”_blank”>Kansas</a>, and <a href=”/personal-line-of-credit-loans/missouri.aspx” rel=”noopener” target=”_blank”>Missouri</a>. A personal line of credit is a kind of open-end credit that allows you to make multiple withdrawals and repayments within the pre-approved borrowing limit.</p>
<p>If you’re looking for a closed-end credit option, you can apply for our installment loans in <a href=”/installment-loans/arizona-installment-loans.aspx” rel=”noopener” target=”_blank”>Arizona</a> and <a href=”/installment-loans/nevada-installment-loans.aspx” rel=”noopener” target=”_blank”>Nevada</a>. Whether you choose our open-end credit option or closed-end one, you will be able to get the benefit of fixed monthly repayments in both cases.</p>
<p>You have a certain amount of credit to use with a credit card. You are obligated to repay the amount of credit that you have used. You can keep the credit line open forever, hence the term open-end credit.</p>
<h2>Understanding Open-End Credit</h2>
<p>Open-end credit agreements are excellent financing options for you because they allow you more control over how much and when you can borrow. In addition, you’re not charged interest on the amount of the <a href=”https://www.cash1loans.com/personal-line-of-credit-loans.aspx”>line of credit</a> that you do not use, which can lead to interest savings for you compared to an <a href=”https://www.cash1loans.com/installment-loans.aspx”>installment loan</a>.</p>
<h2>How Does Open-End Credit Work?</h2>
<p>Once approved, you’ll have access to your entire credit limit or total amount. For instance, a lender approves a $2,500 line of credit, and you withdraw $2,000. Your payments to be made will be $2,000 plus interest, without having to repay the $500 remaining in the account unless the same is utilized for something else. Once you pay off the $2,000 owed, your line of credit stays open for you to borrow more later, making the <a href=”https://www.cash1loans.com/blog-news/what-is-revolving-credit.aspx”>line of credit revolving</a>. This allows you to access as much or as little money as you choose, depending on your current needs.</p>
<h2>Examples of Open-End Credit</h2>
<p>Also called bank cards, financial institutions issue them. Credit cards are the more common form in the consumer market and provide immediate access to funds. You borrow any amount up to your approved credit limit and pay back the balance over time.</p>
<p>The lender charges interest on the amount you owe and could incur charges if you make a late payment or go over your credit limit. The amount you repay becomes available for you to use again. American Express. MasterCard, and VISA, are widely recognized credit cards.</p>
<h3>Home Equity Lines of Credit (HELOCs)</h3>
<p>A home equity line of credit is another common form and uses a percentage of your home equity to provide a revolving line of credit. You can draw from your line of credit and repay some of it monthly or pay it in full, somewhat like a credit card.</p>
<h3>Charge Cards</h3>
<p>Oil companies, department stores, and telephone companies issue the second-largest credit card category. You can only make purchases from the company that issued the card. You make payments every month and pay your balance at your own pace, with interest.</p>
<h3>Travel and Entertainment (T&E) Cards</h3>
<p>This credit card type was initially used to pay for airline, hotel, and other business expenses. Now, all other businesses, such as department stores, drugstores, gas stations, accept them. The significant difference between travel and entertainment cards, and bank cards, is that travel entertainment cards require that you pay in full each month, but they do not charge interest. American Express, Diners Club, and Carte Blanche are T&E cards. Diners Club was the first travel card when it was issued in 1950.</p>
<h3>Bank Overdraft Protection for Checking Accounts</h3>
<p>Overdraft protection and <a href=”/blog-news/what-is-open-end-credit.aspx” rel=”noopener” target=”_blank”>overdraft services are a line of credit</a> that can cover your transactions when you spend more than the amount in your checking account. It protects you from missing payments, bouncing checks, and having your debit card declined.</p>
<h2>Secured and Unsecured Open-End Credit</h2>
<p>Open-end loans are categorized as either secured or unsecured:</p>
<h3>Open-End Unsecured</h3>
<p>A loan or line of credit is unsecured when it does not require an item of value as security. For example, most credit cards are issued to you without collateral attached to them. However, you’ll need to have a moderate to good credit score to be approved for an unsecured line of credit. A good score shows the lenders that you are a minimal risk to themto a them and can managecanmanage a higher credit limit.</p>
<h3>Open-End Secured</h3>
<p>To be approved for a secured open line of credit, you’ll need <a href=”https://www.cash1loans.com/blog-news/what-collateral-and-how-do-collateral-loans-work.aspx”>collateral</a>. Some examples are home equity lines of credit (HELOCs) and secured credit cards. The amount of money or credit you receive will depend on the amount you have deposited with the issuing bank if it’s a secured credit card.</p>
<p>Whereas the value of your property attached is considered in regards to HELOCs. Failure to repay your loan within the agreed term could forfeit the property used as security.</p>
<h2>Advantages of Open-End Credit Products</h2>
<ul style=”margin-left: 25px;”>
<li>Some of the benefits of open-end loans or credit lines include:</li>
<li>Your terms of borrowing and making payments are flexible.</li>
<li>A credit card allows you to make multiple purchases without worrying about cash. Also, you may benefit from loyalty programs available on purchases with your credit card.</li>
<li>You can cover unexpected emergencies.</li>
<li>HELOCs commonly have lower interest rates.</li>
<li>A secured credit card allows you the opportunity to improve your credit score and qualify for an unsecured credit card in the future.</li>
</ul>
<h2>Disadvantages of Open-End Credit Products</h2>
<ul style=”margin-left: 25px;”>
<li>Open-end lines of credit and loans do have their drawbacks:</li>
<li>Unsecured open-end credit lines generally have higher interest rates and credit requirements than those secured by collateral.</li>
<li>Annual Percentage Rates (APRs) for open lines of credit are always varied widely from one lender to another.</li>
<li>If you misuse your credit account, you’ll hurt your credit score. It’s estimated that the average household in the U.S. will carry about <a href=”https://www.valuepenguin.com/average-credit-card-debt#average-credit-card-debt”>$807 of credit card debt in 2020</a>.</li>
<li>The terms of your loan could change at any time. If your credit rating goes up, your credit limit could be increased. On the other hand, your limit can also decrease if your lender considers you a higher risk than when you first applied.</li>
<li>Late payments and fees for going over your credit limit can be expensive.</li>
<li>You could be tempted to overspend, leading to difficulty keeping up with your payments.</li>
</ul>
<h3>American Consumer Debt (Billions)</h3>
<table border=”1″ cellpadding=”0″ cellspacing=”0″ width=”100%”>
<tbody>
</tbody>
<thead style=”background-color: #134071; color: #fff;”>
<tr>
<th style=”width: 25%”>Year</th>
<th style=”width: 20%”>Credit Card Debt</th>
<th style=”width: 20%”>Total Debt</th>
<th style=”width: 35%”>Credit Card Debt to Total Debt %</th>
</tr>
</thead>
<tbody>
<tr>
<td>2010</td>
<td>$731</td>
<td>$11,844</td>
<td>6.20%</td>
</tr>
<tr style=”background-color:#dddddd;”>
<td>2011</td>
<td>$693</td>
<td>$11,661</td>
<td>5.90%</td>
</tr>
<tr>
<td>2012</td>
<td>$674</td>
<td>$11,310</td>
<td>6.00%</td>
</tr>
<tr style=”background-color:#dddddd;”>
<td>2013</td>
<td>$672</td>
<td>$11,280</td>
<td>6.00%</td>
</tr>
<tr>
<td>2014</td>
<td>$680</td>
<td>$11,710</td>
<td>5.80%</td>
</tr>
<tr style=”background-color:#dddddd;”>
<td>2014</td>
<td>$680</td>
<td>$11,710</td>
<td>5.80%</td>
</tr>
<tr>
<td>2015</td>
<td>$714</td>
<td>$12,065</td>
<td>5.90%</td>
</tr>
<tr style=”background-color:#dddddd;”>
<td>2016</td>
<td>$747</td>
<td>$12,350</td>
<td>6.00%</td>
</tr>
<tr>
<td>2017</td>
<td>$808</td>
<td>$12,955</td>
<td>6.20%</td>
</tr>
<tr style=”background-color:#dddddd;”>
<td>2018</td>
<td>$844</td>
<td>$13,512</td>
<td>6.20%</td>
</tr>
<tr>
<td>2019</td>
<td>$881</td>
<td>$13,952</td>
<td>6.30%</td>
</tr>
<tr style=”background-color:#dddddd;”>
<td>2020</td>
<td>$807</td>
<td>$14,353</td>
<td>5.60%</td>
</tr>
</tbody>
</table>
<p><span>Source: <a href=”https://www.newyorkfed.org/microeconomics/hhdc.html”>Federal Reserve Bank of New York</a></span></p>
<p> </p>
<h2>Open-End Credit Laws</h2>
<p>Truth in Lending (Regulation Z) protects you when using consumer credit. <a href=”https://www.consumerfinance.gov/rules-policy/regulations/1026/”>The Consumer Financial Protection Bureau (CFPB)</a> enforces the regulations to guarantee that your creditors adhere to the rules. Regulation Z provides guidelines on actions required during, after, and before creating an account. Congress last made changes to Regulation Z in March of 2021. The rules focus on specific guidance on disclosures, billing cycles, and civil liabilities to resolve those issues in case of an error resulting in any damages.</p>
<h3>When creating an open-end credit plan, your creditor must disclose to you each of these items in terms of your open-end credit:</h3>
<ul style=”margin-left: 25px;”>
<li>A section explaining how your creditor calcuates your APR and any other charges to your account.</li>
<li>The conditions and method of computing the balance upon which a finance charge may be imposed, including any set minimum or a fixed amount.</li>
<li>Whether you are provided a grace period or not.</li>
<li>A statement gives you notice of how the lender will secure your loan regarding collateral.</li>
<li>A statement should be provided explaining the obligations of both the creditor and you.</li>
</ul>
<h3>If your credit has been extended, the lender is required to send you statements within each billing cycle that will include:</h3>
<ul style=”margin-left: 25px;”>
<li>The date your payment must be made to avoid additional charges or penalties.</li>
<li>Any outstanding balance at the beginning of a statement period.</li>
<li>Your account’s due balance at the end of the statement period.</li>
<li>What you owe and a statement of how the creditor determined it.</li>
<li>A brief description of the date, amount, and credit extensions during a specified period.</li>
<li>The total payments that were credited to you during a statement period.</li>
<li>The full finance charge billed as interest.</li>
<li>The address, phone number, or website where your billing inquiries are to be sent.</li>
</ul>
<h3>Your creditor’s penalty for violating any of the above disclosure requirements include:</h3>
<ul style=”margin-left: 25px;”>
<li>Attorneys’ fees and costs incurred by you when seeking legal remedy.</li>
<li>The actual cost of damage suffered by you as a result.</li>
<li>Twice the amount of any finance charges between $100 and $1,000.</li>
</ul>
<h2>What Is A Personal Loan?</h2>
<p>When you apply for a personal loan, you ask a particular lender to let you borrow a specific amount of money, which you repay in a set period. You can obtain a personal loan from banks, credit unions, or online lenders. Loan amounts and interest rates tend to vary depending on the lender you choose.</p>
<p>While auto loans are used to buy a car and mortgages are used to pay off a house, <a href=”/blog-news/best-reasons-for-personal-loans.aspx” rel=”noopener” target=”_blank”>personal loans can be used for many different reasons</a>. You can take out a personal loan to fund a medical emergency, for your education, make a big purchase for your house, or even consolidate multiple debts.</p>
<p>Repaying your credit card debt is different from repaying your personal loan. Personal loans tend to come with a fixed monthly payment over a set period until you have completely paid off your debt.</p>
<h2>Personal Loan Requirements You Should Know</h2>
<p>Personal loan requirements tend to vary by lender. Websites like <a href=”https://www.creditninja.com” rel=”noopener” target=”_blank”>CreditNinja online lenders</a> require you to provide essential documentation. However, other lenders might ask for many types of documents.</p>
<p>The following are personal loan requirements you should keep in mind:</p>
<h3>Credit Score and History</h3>
<p>Your credit score is one of the tools lenders use to assess your ability to repay the loan in the future. Credit scores tend to range from 300 to 850. Furthermore, the scores are based on several factors, such as your payment history, number of existing debts, and length of your credit history.</p>
<p>Most lenders require applicants to have a score of 600 at minimum to <a href=”/personal-loans.aspx” rel=”noopener” target=”_blank”>qualify for a personal loan</a>. However, other lenders also accept applicants with bad credit or no credit history. There is nothing to worry about if you are one of the latter; you need to find the right lender that can help you out despite your current situation.</p>
<p>If you know how to manage a personal loan well, it will affect your credit score positively. However, late or missed payments will hurt it. That is why, before you make any debt-related decisions, it’s vital to check your credit score to know and understand your current credit standing.</p>
<h3>Income</h3>
<p>Lenders usually impose income requirements on loan applicants. It’s to ensure that the borrower has the means to repay the loan. These income requirements are not the same with all lenders. Proof of income may include monthly bank statements, latest tax returns, pay stubs, etc.</p>
<h3>Debt-To-Income Ratio (DTI)</h3>
<p>Your <a href=”https://businesscasestudies.co.uk/why-does-calculating-your-debt-to-income-ratio-matter/” rel=”noopener” target=”_blank”>debt-to-income ratio</a> is composed of your existing monthly debts over your current monthly income. Lenders tend to check your DTI to predict the chances of your ability to make payments for your new and existing debts.</p>
<p>A DTI that is less than 36% is ideal for most lenders. However, there is a big chance that a lender will automatically approve your loan application if you have a DTI of up to 50%.</p>
<h3>Collateral</h3>
<p>Most personal loans are <a href=”https://www.cash1loans.com/blog-news/unsecured-personal-loans.aspx” target=”_blank”>unsecured</a>. However, if you are applying for a secured personal loan, the lender will require you to pledge collateral.</p>
<p>A <a href=”https://www.cash1loans.com/blog-news/secured-loan-definition.aspx” rel=”noopener” target=”_blank”>secured personal loan</a> also accepts collateral in the form of investment accounts, cash accounts, real estate, and even collectibles like precious metals or valuable coins. If you default on your secured personal loan, the lender can repossess your collateral to recoup the loan balance.</p>
<h3>Origination Fee</h3>
<p>The origination fee is not part of the qualification process in getting a personal loan. However, many lenders require borrowers to pay origination fees. It’s to cover the expenses in processing the application and running some credit checks.</p>
<p>Origination fees tend to range between 1 and 8 percent of your total loan amount. It usually depends on several factors, such as the loan amount and your credit score.</p>
<h2>To Sum It Up</h2>
<p>A personal loan is a type of debt that can help you get a certain amount of money you must pay in a set period. This type of loan can be used for many different reasons. However, to <a href=”https://www.cash1loans.com/blog-news/how-get-personal-loan.aspx” target=”_blank”>get a personal loan</a>, you must consider the requirements of applying for one to make sure you have a great chance of getting approved.</p>
<p><strong>Author Bio:</strong></p>
<p><img alt=”Finance Blogger David Owens” src=”/Portals/0/Images/blog/loans/david-owens.png” width=”149″ /></p>
<p>David Owens is a seasoned content writer specializing in finance – debt management, entrepreneurship, and business finance. When not writing, he travels with his cat, Mellie.</p>
<p> </p>
<p>There is no one size fits all answer to how many lines of credit you should have. The perfect balance for you depends on the requirements, your ability to pay them off, and how you <a href=”/blog-news/how-many-lines-of-credit-should-you-have.aspx” rel=”noopener” target=”_blank”>use your line of credit</a>. Having two lines of credit could be too many if you can’t afford to make your payments or don’t have plans to use it soon.</p>
<p>A <a href=”https://www.myfico.com/credit-education/credit-scores/new-credit” target=”_blank”>new line of credit may improve your credit score</a>. However, you should never take out an additional line of credit unless necessary. Applying for multiple lines of credit in a short period is not advised, and having too many lines of credit make you look risky to lenders.</p>
<h2>How Many Lines of Credit Do Americans Have?</h2>
<p>While Americans, on average, have nearly four credit cards each, that’s only a national average. FICO discovered that cardholders in the excellent range of credit, scores 750 to 850, had three open accounts. They had a total of six lines of credit if you include closed accounts.</p>
</div>
<div style=”text-align; margin: 0 auto; width: 300px;”><img alt=”how many lines of credit do people have in New Jersey?” src=”/portals/0/Images/blog/loans/how-many-lines-of-credit-US-states-new-jersey.png” />
<p>New Jersey residents have an average 3.49 credit cards.</p>
<br />
<img alt=”how many lines of credit do people have in New York?” src=”/portals/0/Images/blog/loans/how-many-lines-of-credit-US-states-new-york.png” />
<p>New York residents have an average 3.34 credit cards.</p>
<br />
<img alt=”how many lines of credit do people have in Rhode Island?” src=”/portals/0/Images/blog/loans/how-many-lines-of-credit-US-states-rhode-island.png” />
<p>Rhode Island residents have an average 3.26 credit cards.</p>
<br />
<img alt=”how many lines of credit do people have in Hawaii?” src=”/portals/0/Images/blog/loans/how-many-lines-of-credit-US-states-hawaii.png” />
<p>Hawaii residents have an average 3.25 credit cards.</p>
<br />
<img alt=”how many lines of credit do people have in California?” src=”/portals/0/Images/blog/loans/how-many-lines-of-credit-US-states-california.png” />
<p>California residents have an average 3.23 credit cards.</p>
</div>
<h2>Do Lines of Credit Affect Your Credit Score?</h2>
<p>How many lines of credit you have doesn’t directly affect your credit score. More important than the number of credit lines you have is whether you pay on time and what percentage of your available credit you use. Most people with excellent FICO scores, 795 or higher, do not have late payments on their credit reports. They also only use 7% of their credit limit. If you’re thinking of opening or closing a <a href=”/blog-news/what-is-revolving-credit.aspx”>revolving line of credit</a>, keep these in mind:</p>
<p><span style=”font-weight: 700;”>Your Payment History</span><br />
How much credit you use and your payment history determine 65% of your FICO score. Paying your credit lines on time is far more important than how many lines of credit you have. If you want to <a href=”/blog-news/credit-repair-improve-credit-fast.aspx”>build your credit score fast</a> – pay your credit bills on time.</p>
<p><span style=”font-weight: 700;”>Your Credit Utilization</span><br />
How much of the credit limit you use, called the credit utilization ratio, accounts for one-third of your credit score. Keeping your ratio below 30% can help you maximize your credit score.<br />
<br />
If you <a href=”https://www.cash1loans.com/personal-line-of-credit-loans.aspx”>open a new line of credit</a> and increase your overall credit line, it could help build your credit score by decreasing your credit utilization. It’s important to know that applying for a new line of credit results in a hard credit inquiry which can temporarily drop your score a few points. You’ll want to avoid applying for multiple credit lines; spacing applications six months apart will prevent numerous hard inquiries from affecting your score.</p>
<p><span style=”font-weight: 700;”>Your Credit History</span><br />
The age of your line of credit is essential. Lenders and creditors like to see stable and long credit histories. But having one old line of credit that was appropriately managed is not enough.<br />
<br />
Your credit score is the average of all the lines of credit that you have. A ding to your credit may be worth it if you close a line of credit when you feel the interest rate is too high or the service is terrible. It’s always worth communicating with your lender to see your options before closing your credit line.</p>
<p><span style=”font-weight: 700;”>Your New Credit Accounts</span><br />
Recently opened credit accounts calculate 10% of your credit score. The new credit can be detrimental to you if you have a short credit history. As mentioned before, you should wait at least six months before opening another.</p>
<p><span style=”font-weight: 700;”>Your Credit Mix</span><br />
Another 10% of your FICO® score is your credit mix or amount of credit lines. The credit bureaus consider your variety of lines of credit, retail accounts, and credit cards. It’s unnecessary to have each type of credit, but lenders like to see you manage a diverse <a href=”https://www.cash1loans.com/blog-news/types-of-lines-of-credit.aspx” target=”_blank”>range of credit lines</a>.</p>
<h2>Is It Good to Have Multiple Lines of Credit?</h2>
<p>Yes, you can have multiple lines of credit at one time. Most people have several at a time. If you currently have credit cards, a mortgage, student loans, etc., you have more than one line of credit. There are pros to having multiple as long as you keep up with all payments.</p>
<p><span style=”font-weight: 700;”>Pros</span><br />
Your FICO® score determines the amount and variety of loans you can manage at once. This is one of the most widely used credit scores, and having <a href=”/blog-news/boost-my-credit-score.aspx”>multiple lines of credit can boost it</a>. FICO sees the variety of loans as experience with borrowing money. You won’t benefit from multiple lines of credit if you don’t keep up with payments, have a high credit utilization rate, and use unhealthy credit practices.</p>
<p><span style=”font-weight: 700;”>Cons</span><br />
Even though having more than one line of credit can be helpful, it comes with potential risks. When you have multiple loans, you are adding additional interest to your monthly expenses. If you have high interest rates, it could become challenging to meet all payment obligations on time.With multiple lines of credit to pay off, it is easier to forget to pay a bill. This could negatively impact your credit score and affect your chances of getting a long-term or short-term loan.If you take out too many lines of credit, FICO may see this as you being in financial trouble.</p>
<h2>How to Manage Multiple Lines of Credit</h2>
<p>When you want to build your credit, it’s best to have at least two open lines of credit. Keep your oldest credit line open, and you should be able to get an upgrade after making payments on time for six months. There are many ways to manage your credit line, so here are scenarios for one, two, and three or more lines of credit.</p>
<p><span style=”font-weight: 700;”>One Line of Credit</span><br />
One credit account is common, especially if you’re starting or building from any financial mistakes. If you have more established credit, you may choose to have a single line of credit to avoid any temptation of overspending or forgetting to make a payment. The only issue with having only one credit line is that you may be leaving savings on the table.</p>
<p><span style=”font-weight: 700;”>Two Lines of Credit</span><br />
If you don’t have any debt with your two credit lines, you could use a pair of reward cards. One might offer cashback rewards, and the other could give you travel rewards or discounts at your favorite store. If you have debt or are preparing to make a large purchase that could take months to resolve, you should use a rewards card for everyday spending and a 0% card for financing.</p>
<p><span style=”font-weight: 700;”>Three or More Lines of Credit</span><br />
Having a third credit line allows you to be more opportunistic with special offers and pick and choose the best terms. If you plan on paying in full, you can opt in for the best rewards card for your most significant monthly purchases. You can use two core cards and supplement with the best initial offers available. You could also use a couple of rewards cards with a 0% APR offer. But remember, the more lines of credit you have, the more you’ll need to manage these financial responsibilities.</p>
<div style=”text-align; margin: 0 auto; width: 340px;”><img alt=”how to choose the right number of credit lines” src=”/portals/0/Images/blog/loans/how-to-choose-the-right-number-of-credit-lines.png” /></div>
<h2>How to Choose the Right Number of Credit Lines</h2>
<p><span style=”font-weight: 700;”>Expand As Your Credit Grows</span><br />
The most important factor determining how many lines of credit you should have, or can have, is your experience. You’ll need to ask yourself if you have established credit or are you starting out? The less experienced or, the worse your credit score is, the fewer options you’ll have and the more you’ll need to focus on one credit line and manage it responsibly.</p>
<p><span style=”font-weight: 700;”>Perfectly Manage Your One Card</span><br />
If you have good or <a href=”/blog-news/what-is-a-bad-credit-score.aspx”>bad credit</a>, you’ll need to master a single line of credit before you expand to new horizons. It may take a year to pay more than the minimum requirement on time and avoid racking the balance. Adding a new line of credit to the mix could potentially increase your costs, <a href=”/blog-news/credit-repair-what-hurts-your-credit-score.aspx”>hurt your current score</a> and complicate matters.</p>
<p><span style=”font-weight: 700;”>Automate Your Payments</span><br />
The best way to limit your chances of missing a payment is by setting up automatic payments. It’s almost imperative if you have multiple due dates to remember. You’ll have the option to pay a custom amount, pay the entire balance, or the minimum. You’ll need to decide what works best for your budget, but if you’ve read this far, you know the option is to try and pay in full. Paying off cards you don’t use often is essential because small balances can quickly add up with charges on small purchases that you may forget about.</p>
<p><span style=”font-weight: 700;”>Increase Your Spending Limit</span><br />
If you want to increase your spending limit to decrease your credit utilization, consider asking your current card to increase your spending limit. You can avoid the risk and hassles of applying for a new line of credit.</p>
<h2>Pros & Cons of Opening A New Account</h2>
<p style=”font-weight: 700;”>Pros</p>
<ol>
<li>If you already have credit, you can lower your overall credit utilization ratio</li>
<li>You can build your credit faster because more information is reported to major credit bureaus each month</li>
<li>You can have access to 0% financing or better rewards You have emergencies covered with more credit</li>
<li>You can take advantage of excellent sign-up perks</li>
</ol>
<p style=”font-weight: 700;”>Cons</p>
<ol>
<li>You can increase your debt to unsustainable levels</li>
<li>You can damage your credit temporarily</li>
<li>You can have difficulty managing multiple due dates</li>
</ol>
<h2>Average Credit Card Balance by State</h2>
<p>Are you wondering how your state matches up with a line of credit balances? Here’s who has the highest credit balances.</p>
<div style=”margin:0 auto; width: 100%;”>
<table border=”1″ bordercolor=”#ddd” cellpadding=”5″ cellspacing=”0″ width=”100%”>
<tbody>
<tr>
<th style=”text-align: left; color: #fff; background-color: #D47729; width: 50%; font-size: 12px;”>State</th>
<th style=”text-align: left; color: #fff; background-color: #D47729; width: 50%; font-size: 12px;”>Average Credit Card Balance</th>
</tr>
<tr>
<td style=”font-size: 12px;;”>Alabama</td>
<td style=”font-size: 12px;;”>$5,672</td>
</tr>
<tr>
<td style=”background-color: #ddd; font-size: 12px;;”>Alaska</td>
<td style=”background-color: #ddd; font-size: 12px;;”>$8,026</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Arizona</td>
<td style=”font-size: 12px;;”>$6,053</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Arkansas</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,327</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>California</td>
<td style=”font-size: 12px;;”>$6,222</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Colorado</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,416</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Connecticut</td>
<td style=”font-size: 12px;;”>$7,082</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Delaware</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,335</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>District of Columbia</td>
<td style=”font-size: 12px;;”>$7,077</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Florida</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,460</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Georgia</td>
<td style=”font-size: 12px;;”>$6,569</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Hawaii</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,673</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Idaho</td>
<td style=”font-size: 12px;;”>$5,213</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Illinois</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,253</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Indiana</td>
<td style=”font-size: 12px;;”>$5,254</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Iowa</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$4,774</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Kansas</td>
<td style=”font-size: 12px;;”>$5,769</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Kentucky</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,140</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Louisiana</td>
<td style=”font-size: 12px;;”>$5,811</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Maine</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,44 2</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Maryland</td>
<td style=”font-size: 12px;;”>$6,946</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Massachusetts</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,213</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Michigan</td>
<td style=”font-size: 12px;;”>$5,399</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Minnesota</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,489</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Mississippi</td>
<td style=”font-size: 12px;;”>$5,134</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Missouri</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,601</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Montana</td>
<td style=”font-size: 12px;;”>$5,482</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Nebraska</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,423</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Nevada</td>
<td style=”font-size: 12px;;”>$6,220</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>New Hampshire</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,235</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>>New Jersey</td>
<td style=”font-size: 12px;;”>$7,084</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>New Mexico</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,851</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>New York</td>
<td style=”font-size: 12px;;”>$6,491</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>North Carolina</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,832</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>North Dakota</td>
<td style=”font-size: 12px;;”>$5,265</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Ohio</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,560</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Oklahoma</td>
<td style=”font-size: 12px;;”>$5,848</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Oregon</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,498</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Pennsylvania</td>
<td style=”font-size: 12px;;”>$5,840</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Rhode Island</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,177</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>South Carolina</td>
<td style=”font-size: 12px;;”>$5,938</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>South Dakota</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,235</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Tennessee</td>
<td style=”font-size: 12px;;”>$5,688</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Texas</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,753</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Utah</td>
<td style=”font-size: 12px;;”>$5,600</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Vermont</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$5,466</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Virginia</td>
<td style=”font-size: 12px;;”>$6,969</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Washington</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$6,156</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>West Virginia</td>
<td style=”font-size: 12px;;”>$5,144</td>
</tr>
<tr>
<td style=”background-color: #ddd;font-size: 12px;;”>Wisconsin</td>
<td style=”background-color: #ddd;font-size: 12px;;”>$4,961</td>
</tr>
<tr>
<td style=”font-size: 12px;;”>Wyoming</td>
<td style=”font-size: 12px;;”>$5,782</td>
</tr>
</tbody>
</table>
</div>
<h2>Are You Looking for A Line of Credit?</h2>
<p>If you have been denied a line of credit because you have <a href=”https://www.cash1loans.com/blog-news/bad-credit-line-of-credit.aspx” target=”_blank”>bad credit</a> or no credit at all, you can <a href=”/apply-now.aspx” target=”_blank”>apply online</a>.</p>
<p>So, please keep reading to find out what these two common types of revolving credit mean and how they work and differ from each other.</p>
<h2>What is a Line of Credit?</h2>
<p>A line of credit is a credit option that allows you to <a href=”https://www.cash1loans.com/blog-news/how-many-lines-of-credit-should-you-have.aspx” target=”_blank”>borrow money multiple times</a> up to a specific limit. Since you can borrow money when you need it, you only pay interest on the funds you borrow and not the entire credit limit.</p>
<p>There are two main <a href=”/blog-news/types-of-lines-of-credit.aspx” rel=”noopener” target=”_blank”>types of lines of credit</a> (LOC), secured and unsecured. While both work more or less the same way, a secured line of credit is guaranteed by collateral, whereas an unsecured line of credit doesn’t require any collateral. A personal line of credit is one of the most common types of unsecured LOC, whereas home equity lines are secured LOC.</p>
<h2>How Does a Line of Credit Work?</h2>
<p>The requirements to open a line of credit vary from lender to lender and the loan type. Once your loan is approved and you get your approved borrowing limit, you can decide the amount you need within that limit. You can choose to either get your funds deposited straight to your checking account or get a check. For instance, if you have been approved for a credit limit of $20,000 and use only $5,000. Your lender charges interest on $5,000, the withdrawn amount. You can use the remaining $15,000 whenever you need extra cash during emergencies.</p>
<p>Your line of credit lender will issue a statement every month showing the minimum monthly payment you need to pay. There’s an option to repay by making just the minimum payments every month or paying your outstanding balance in full at once.</p>
<h2>Pros and Cons of Lines of Credit</h2>
<h3 style=”margin-top:20px; margin-bottom:15px;”>PROS</h3>
<ul>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>More flexible and favorable terms</strong></h4>
<p>You can apply for a line of credit and only use what you need. This way, you pay the interest on the amount you withdraw and not on the entire credit line.</p>
</li>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Helpful in making larger purchases</strong></h4>
<p>Since the credit limit for a line of credit could be higher than that for a credit card, you can use it when you need to make a large purchase.</p>
</li>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Significantly lower interest rates</strong></h4>
<p>Although interest rates on a line of credit vary depending on its type and state of origination, a line of credit typically comes with lower interest rates than credit cards.</p>
</li>
</ul>
<h3 style=”margin-top:20px; margin-bottom:15px;”>CONS</h3>
<ul>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>No grace period is available</strong></h4>
<p>There is no grace period on a personal line of credit. That means interest will start to accrue right from the date you withdraw from your line of credit loan.</p>
</li>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Risk of overspending</strong></h4>
<p>Access to high credit limits can be an advantage, but it can also encourage overspending and put you into financial trouble.</p>
</li>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Long pay-back period</strong></h4>
<p>If you only make minimum payments on your line of credit loan, it can take a long time for you to pay off your principal balance and interest.</p>
</li>
</ul>
<h2>What is a Credit Card?</h2>
<p>A credit card is issued to facilitate easy payments for making purchases or clearing your bills. The best part is that you can earn rewards on every purchase you make using a credit card and pay later. Credit cards as <a href=”https://www.cash1loans.com/blog-news/what-is-revolving-credit.aspx” target=”_blank”>revolving credit</a> allow you to borrow money to pay for goods and services. You need to repay the amount generated in your credit card bill every month on or before the due date.</p>
<h2>How Does a Credit Card Work?</h2>
<p>Just like a line of credit, a credit card also comes with a set credit limit. You need to swipe your credit card or enter card details for all the purchases you make within your available credit limit. Depending on your credit card provider and card type, you can earn various rewards, making credit cards even more beneficial.</p>
<p>You get a grace period before your due date, giving you time to make arrangements for your payments. There are no interest charges if you choose to pay the entire balance during this period. If not, you should make at least the minimum payments generated with every billing cycle by the due date to avoid late fees and risk your credit score.</p>
<p><img alt=”how does interest free grace period work?” src=”/Portals/0/how-does-interest-free-grace-period-work.png?ver=NkzXhL2_6ixLMVlANpV_TQ%3d%3d” style=”width: 738px” /></p>
<h2>Pros and Cons of Credit Cards</h2>
<h3 style=”margin-top:20px; margin-bottom:15px;”>PROS</h3>
<ul>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Widely accepted payment option</strong></h4>
<p>Credit cards are one of the widely used cash-less payment modes. They are convenient to use and safe and secure for making monetary transactions.</p>
</li>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Interest-free grace period</strong></h4>
<p>Credit cards usually offer a grace period on purchases during which you can avoid paying interest. However, you may not get a grace period on cash advance on your credit card.</p>
</li>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Opportunity to earn reward points</strong></h4>
<p>A credit card with rewards can help you earn points or cashback on every new purchase you make. You can redeem these credit card rewards you have earned for further discounts.</p>
</li>
</ul>
<h3 style=”margin-top:20px; margin-bottom:15px;”>CONS</h3>
<ul>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Relatively high-interest rates</strong></h4>
<p>Although you don’t need a magnificent credit score to get a credit card, borrowing money with a credit card can be expensive. Credit cards charge comparatively higher interest rates than a line of credit.</p>
</li>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Lower credit limits</strong></h4>
<p>Different credit card providers offer other credit limits depending on the customer’s financial profile. But if you compare credit cards with a line of credit, then credit cards offer a lower borrowing limit.</p>
</li>
<li style=”list-style: disc”>
<h4 style=”text-transform: inherit;”><strong>Additional fees and hidden charges</strong></h4>
<p>Credit cards offer great deals and discounts, but they come with some hidden charges that can increase your total cost. You can also be levied fees for missing a payment or surpassing your credit limit.</p>
</li>
</ul>
<h2>The Difference Between Line of Credit and a Credit Card</h2>
<p>After knowing how lines of credit and credit cards work, you might have figured out the difference between the two. Understanding the key differences can help you choose the most appropriate according to your needs and convenience.</p>
<table border=”1″ cellpadding=”10″ cellspacing=”0″>
<tbody>
<tr>
<td style=”text-align: center; font-weight: 700; line-height: 1.3;”>Factors</td>
<td style=”text-align: center; font-weight: 700; line-height: 1.3;”>Lines of Credit</td>
<td style=”text-align: center; font-weight: 700; line-height: 1.3;”>Credit Cards</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>Credit limit</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Higher limit than most credit cards</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Lower credit limits than lines of credit</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>When to use</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>For large purchases and business payments</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>For everyday purchases and bill payments</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>Subtypes</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Can be secured or unsecured</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Mostly unsecured</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>Interest rates</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Lower than most credit cards</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Usually higher than lines of credit</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>Rewards</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Not provided</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Offers different rewards based on your usage</td>
</tr>
<tr>
<td style=”text-align:left; padding: 5px; line-height: 1.3;”>Repayments</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Fixed monthly repayments without grace period</td>
<td style=”text-align: left; padding: 5px; line-height: 1.3;”>Easy repayments with grace period</td>
</tr>
</tbody>
</table>
<p> </p>
<h2>Choosing What Is Right For You</h2>
<p>The choice between a credit card and a line of credit depends mainly on your purpose for borrowing the money. If you’re looking for a simple way to pay for your everyday purchases, a credit card can be your go-to option. You can save money on interest by paying your balance in full every month and getting rewards that you can use for your next bill payment or purchase.</p>
<p>On the other hand, a line of credit loan can be a suitable option when you want to consolidate your debt or have a hefty bill to pay off. You can schedule your monthly payments to stay within your budget.</p>
<p>While comparing credit cards and lines of credit, both seem like great revolving credit options. However, before choosing one, always make sure to have answers to your <a href=”/frequently-asked-questions/line-of-credit-faq.aspx” rel=”noopener” target=”_blank”>line of credit questions</a> and thoroughly check the terms and conditions of different lines of credit lenders and credit card providers.</p>
<h2>Get Your CASH 1 Line Of Credit Online</h2>
<p style=”margin-bottom: 25px;”>If you have irregular income or frequently have other bills to pay monthly, a credit line might be helpful. CASH 1 offers line of credit loans online in <a href=”/personal-line-of-credit-loans/utah.aspx” rel=”noopener” target=”_blank”>Utah</a>, <a href=”/personal-line-of-credit-loans/idaho.aspx” rel=”noopener” target=”_blank”>Idaho</a>, <a href=”/personal-line-of-credit-loans/kansas.aspx” rel=”noopener” target=”_blank”>Kansas</a>, <a href=”/personal-line-of-credit-loans/missouri.aspx” rel=”noopener” target=”_blank”>Missouri</a>, and <a href=”/personal-line-of-credit-loans/louisiana.aspx” rel=”noopener” target=”_blank”>Louisiana</a> to provide you with the missing funds. Once you’re approved, you can borrow money within the credit limit any number of times. Since a line of credit is a revolving credit type, it will stay active even after you pay back the balance. It means you can <a href=”/blog-news/how-to-use-your-line-of-credit.aspx” rel=”noopener” target=”_blank”>use your line of credit funds</a> whenever you need cash without going through the entire loan approval process.</p>
<p>Most <a href=”/blog-news/unsecured-personal-loans.aspx” rel=”noopener” target=”_blank”>personal loans are unsecured</a>, meaning there’s no need to pledge collateral and put your assets at risk in case of default. Plus, you can practically use them for anything. But like other types of loans, a personal loan can bring more harm than good to your finances if you don’t know how to use it wisely.</p>
<p>To help you make a better decision, here are some top situations where you should use a personal loan.</p>
<h2>1. Boost Your Credit Score</h2>
<p>Credit mix is one component of your credit score. Typically, it considers how well you manage different types of credit, such as installment accounts or revolving accounts. Installment accounts include mortgage, car loans, and personal loans, while revolving accounts consist of credit cards.</p>
<p>Note that lenders perceive borrowers with diverse account mix more favorably than those who only have credit cards, even if both use credits responsibly. If you don’t have any <a href=”https://www.cash1loans.com/installment-loans.aspx” target=”_blank”>installment loan</a> in your credit history, adding a personal loan can support your credit mix and boost your credit score.</p>
<h2>2. Cover Emergency Expenses</h2>
<p>Even with utmost financial planning, major unexpected expenses can throw off your budget. You can put off some of those expenses, but others may require immediate attention. Ideally, you should have an emergency fund to pay for them. But not everyone can set aside a certain amount for emergencies.</p>
<p>If you don’t have an emergency fund or you have one, but it’s not enough to cover certain expenses, a personal loan would be a practical solution. You can <a href=”https://www.forbes.com/sites/forbesfinancecouncil/2020/12/17/funding-your-business-with-a-personal-loan-14-things-to-consider-first/?sh=2611b7167524″ rel=”noopener” target=”_blank”>use a personal loan for anything</a>; however, it’s worth noting that not all unexpected expenses are real emergencies.</p>
<p>Below are actual emergency expenses that you can cover with a personal loan:</p>
<ul>
<li>Medical emergencies</li>
<li>Unexpected job loss</li>
<li>Extra education expenses</li>
<li>Sudden car repairs</li>
<li>Funeral costs</li>
</ul>
<h2>3. Consolidate Debts</h2>
<p>Making monthly payments to multiple lenders can cause a lot of headaches. It can also be costly, especially if you’re dealing with high-interest debts. But you can get your debt under control by consolidating them with a single payment. There are <a href=”/blog-news/debt-how-to-consolidate-debt.aspx” rel=”noopener” target=”_blank”>several ways to consolidate debt, but personal loans are an ideal choice.</a></p>
<p>A reputable online lender clarifies that you can use a personal loan for anything, including paying off multiple debts. Doing so would enable you to lower interest costs, make your debt payments more manageable, or even shorten the repayment timeline.</p>
<p>You’ll know the repayment period of a personal loan ahead of time. Typically, it can go three to five years, depending on the loan amount and other factors. But note that it will only work best if you’re able to secure a personal loan for a lower interest rate, such as the <a href=”https://www.creditninja.com/waukesha-personal-loans/” rel=”noopener” target=”_blank”>CreditNinja loans in Waukesha, WI</a>.</p>
<h2>4. Upgrade or Repair Home</h2>
<p>Necessary alterations or repairs for your home can eat up large sums of cash. On average, homeowners could spend about $9,081 on home improvement, maintenance, and home-related emergencies.</p>
<p>You can tap into your home’s equity, but the amount you can borrow is tied to its value. Plus, it has a longer repayment term, and lenders can foreclose your home if you fail to repay the loan.</p>
<p>If you don’t want to put your home at risk, a personal loan would be a good idea. Unlike home equity loans, the approved amount for a <a href=”/personal-loans.aspx” rel=”noopener” target=”_blank”>personal loan</a> depends on your credit history, income, and employment. The application and approval process is also often faster and easier.</p>
<h2>5. Make A Necessary Large Purchase</h2>
<p>When the cost of a specific project gets mixed in with other living expenses, it can be harder to plan your finances. The good news is, you can use a personal loan to make any necessary purchase. Although a credit card can be an option, you might end up paying more since their interest rates are higher.</p>
<p>Personal loans, on the other hand, have a low-interest rate and fixed monthly payments. It would be easier to manage since you know how much you’re going to pay every month.</p>
<h2>6. Fund A Business Venture</h2>
<p>Entrepreneurs usually secure a business loan to fund their business. But some start-ups may have a difficult time qualifying for one. Most banks consider the financial history of your business before they approve you. They have to ensure that you have a steady stream of revenue to repay the loan.</p>
<p>If you’re planning to fund a new business venture but can’t qualify for a business loan, a personal loan can be an excellent option. Instead of looking at your business history, lenders will evaluate your eligibility based on your credit score. Unlike business loans, a personal loan requires less documentation, and the loan decision is much faster.</p>
<h2>7. Pay for Moving Costs</h2>
<p>You might find yourself in situations where you need to move into a new home. Whether you’re losing a job, downsizing because of high maintenance costs, or other unexpected reasons, an emergency move can cost you some money.</p>
<p>A personal loan can help you cover moving costs, such as hiring movers and transporting your things to the new location. You might also need to pay a security deposit for a new apartment or the cost of furnishing a new home. Securing a personal loan could help you with any extra expenses.</p>
<h2>Points To Consider Before Getting A Personal Loan</h2>
<p>You can get a personal loan for any reason. But remember that it’s borrowed money and you have to pay it back on time. Here are some points you need to consider before getting a personal loan:</p>
<ul>
<li>Are you going to save money if you consolidate your debts with a personal loan?</li>
<li>Are you using a personal loan for an actual emergency expense that you have to pay?</li>
<li>Does taking out a personal loan provide you with an opportunity to improve your finances?</li>
<li>Can you ensure to make monthly payments on time?</li>
</ul>
<p>If you can say yes to any of the questions above, applying for a personal loan might be a good idea.</p>
<h2>Improve Your Finances With A Personal Loan</h2>
<p>A <a href=”https://www.globalvillagespace.com/how-can-you-save-money-with-a-personal-loan/” rel=”noopener” target=”_blank”>personal loan</a> can be a great tool to improve your finances. But like other financial tools, the power of personal loans to help you largely depends on how you decide to use them. For example, getting a personal loan to buy nonessential items can only hurt your finances more. So, always make sure that you’re using this financing option for good reasons.</p>
<p><strong>Author Bio:</strong></p>
<p><img alt=”Finance Blogger David Owens” src=”/Portals/0/Images/blog/loans/david-owens.png” width=”149″ /></p>
<p>David Owens is a seasoned content writer specializing in finance – debt management, entrepreneurship, and business finance. When not writing, he travels with his cat, Mellie.</p>
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<h2>Table of Contents</h2>
<p>Click the link to go directly to a specific section</p>
<ol style=”margin: 0 0 20px;”>
<li style=”list-style-type: none;”><a href=”#how-many1″>How Many Title Loans Can I Get?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many2″>Can I Get Two Title Loans on One Car?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many3″>Will Another Title Loan Affect My Credit?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many4″>How Do I Get a Second Title Loan?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many5″>Requirements</a></li>
<li style=”list-style-type: none;”><a href=”#how-many6″>What Vehicles Can I Use to Get Another Title Loan?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many7″>How Can I Speed Up the Process?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many8″>Does My State Offer Two Title Loans?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many9″>Why Should I Get Another Title Loan?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many10″>Case Study</a></li>
<li style=”list-style-type: none;”><a href=”#how-many11″>How Can I Benefit From Two Title Loans</a></li>
<li style=”list-style-type: none;”><a href=”#how-many12″>What Are the Drawbacks?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many13″>What Are My State’s Title Loan Laws?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many14″>What Are My Alternatives to Getting Two Title Loans</a></li>
<li style=”list-style-type: none;”><a href=”#how-many15″>FAQs</a></li>
<li style=”list-style-type: none;”><a href=”#how-many16″>What Are My Options If I Need a Second Title Loan?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many17″>Why Should I Choose CASH 1?</a></li>
<li style=”list-style-type: none;”><a href=”#how-many18″>Where Are CASH 1 Locations?</a></li>
</ol>
<p id=”how-many1″>Title loans are a fast way to get cash quickly. You might consider <a href=”https://www.cash1loans.com/title-loans.aspx” target=”_blank”>getting a title loan</a> if you have an emergency expense or don’t have enough money to cover a bill. However, you should only use a title loan when you have the money to <a href=”/blog-news/how-pay-title-loan-fast.aspx” rel=”noopener” target=”_blank”>pay it back quickly</a>. If you need more money than your vehicle is worth, you can have more than one title loan at the same time. But, you would need to own another vehicle with a clear title for each loan you get.</p>
<h2>How Many Title Loans Can I Get?</h2>
<p id=”how-many2″>As long your income supports it, there is no limit to the number of vehicles you can use to get title loans. Each clear title that you have represents an opportunity to get funded using your <a href=”/blog-news/what-collateral-and-how-do-collateral-loans-work.aspx” rel=”noopener” target=”_blank”>title as collateral</a>.</p>
<h2>Can I Get Two Title Loans on One Car?</h2>
<p>Getting two title loans on the same car is not possible because a lender places a <a href=”https://www.cash1loans.com/blog-news/lien-on-car-title.aspx” target=”_blank”>lien on your title</a> when you get a title loan on your vehicle. That title is no longer considered clear and will not meet the requirements.</p>
<p id=”how-many3″ style=”text-align:center;”><img alt=”Will Another Title Loan Affect My Credit?” src=”https://www.cash1loans.com/portals/0/images/blog/loans/will-another-title-loan-affect-my-credit.png” /></p>
<h2>Will Another Title Loan Affect My Credit?</h2>
<p>Title loans are essentially borrowing money off the value of your vehicle. Most title lenders don’t run a hard credit inquiry when you apply for a title loan. So, they won’t impact your credit scores.</p>
<p>While a title loan has no negative effect on your credit score, it also has no positive effect on your credit score when you pay it off. Lenders will not report your payments to the three major credit-reporting bureaus, TransUnion, Equifax, and Experian, which means that type of loan will not help your credit score either.</p>
<p id=”how-many4″>Even if you default on your loan, the lender will first need to ensure <a href=”https://www.ftc.gov/legal-library/browse/rules/fair-debt-collection-practices-act-text” target=”_blank”>fair debt collection practices</a>, then repossess and sell your vehicle. Those funds are used to pay the debt, so there is no need for the lender to sell your debt to an agency or report the default to the bureaus.</p>
<h2>How Do I Get a Second Title Loan?</h2>
<p>If you live in a state that allows two title loans, you’ll need to know the value of your vehicle. Depending on the lender you choose, you might be able to get a loan at 50% of your car’s value.</p>
<p>You bring your vehicle, car title, and necessary paperwork to your lender. You can apply online, but you’ll need to go to a title lender for a quick visual inspection and sign the paperwork. Once you complete the application process, the lender keeps <a href=”https://www.ftc.gov/legal-library/browse/rules/fair-debt-collection-practices-act-text” target=”_blank”>your title to the vehicle</a>, places a lien on it, and gives the money to you.</p>
<p id=”how-many5″ style=”text-align:center;”><img alt=”What Are Second Title Loan Requirements?” src=”https://www.cash1loans.com/portals/0/images/blog/loans/what-are-second-title-loan-requirements.png” width=”200″ /></p>
<h2>Requirements</h2>
<h3>18 Years of Age or Older</h3>
<p>You will not receive a title loan unless you are 18 years of age or older.</p>
<h3>Government-issued ID</h3>
<p>A valid Government-issued identification ID is required to obtain a title loan.</p>
<h3>Proof of Income</h3>
<p>Proof of Income is required, such as a pay stub, bank statement, or a verification letter for Social Security benefits or SSI.</p>
<h3>A Clear Title for Your Vehicle</h3>
<p>Original vehicle title showing sole ownership. If there’s another name on the title, they will also need to sign the documents.</p>
<h3>Your Car, Truck, RV, or Motorcycle for an Inspection</h3>
<p>The owner of the vehicle must be present for a brief vehicle inspection.</p>
<h3>Not on Active Duty in Military</h3>
<p id=”how-many6″>It is against the law to get a title loan for U.S. military members.</p>
<h2>What Vehicles Can I Use to Get Another Title Loan?</h2>
<ul>
<li><a href=”https://www.cash1loans.com/car-title-loans.aspx” target=”_blank”>Cars</a></li>
<li><a href=”https://www.cash1loans.com/title-loans/truck-title-loans.aspx” target=”_blank”>Trucks and SUVs Title Loans</a></li>
<li><a href=”https://www.cash1loans.com/title-loans/motorcycle-title-loans.aspx” target=”_blank”>Motorcycle Title Loans</a></li>
<li><a href=”https://www.cash1loans.com/title-loans/rv-title-loans.aspx” target=”_blank”>RV Title Loans</a></li>
<li>Know the requirements</li>
<li>Have your documents ready</li>
<li>Get pre-approved online or on the phone</li>
</ul>
<p id=”how-many8″> </p>
<h2>Does My State Offer Two Title Loans?</h2>
<p id=”how-many9″><img alt=”Does My State Offer Two Title Loans?” /></p>
<p>Alabama, Arizona, Delaware, Georgia, Idaho, Illinois, Indiana, Mississippi, Missouri, Nevada, New Hampshire, New Mexico, South Dakota, Tennessee, Texas, Utah, Virginia, and Wisconsin offer title loans in the United States.</p>
<h2>Why Should I Get Another Title Loan?</h2>
<h3>Pay Your Rent on Time</h3>
<p>Avoid late fees or eviction. Depending on where you live, a landlord can begin the eviction process in a few days. If you get evicted, you’ll have a difficult time renting another place anytime soon. Plus, you might have to pay expensive fees.</p>
<h3>Fast Funds for Car Repairs</h3>
<p>When your car surprises you with an expensive repair, most of us don’t have the extra funds to fix it. It isn’t even an option to not use your car until you save up money for repairs.</p>
<h3>Money for Medical Bills</h3>
<p>Medical debt can increase at a significant rate, and most medical facilities are not into renegotiating. If you need extra money for an existing bill or a current issue, a title loan could help cover your bill or get you some cash for medication.</p>
<h3>Cover Emergency Travel Costs</h3>
<p>Last-minute travel can be costly. You might need a loan to cover a plane ticket to see a sick relative or attend a funeral.</p>
<p id=”how-many10″><img alt=”Case Study for Two Title Loans?” src=”https://www.cash1loans.com/portals/0/images/blog/loans/case-study-for-two-title-loans.png” width=”735″ /></p>
<h2>Case Study</h2>
<p>With low credit scores, Carol and John were unsuccessful in getting funding from a bank. They were trying to get money for a deposit to move into a rental home. They had two dogs, and the rental deposit was more than they had saved, and the home they wanted would be rented soon.</p>
<p>They calculated their budget and determined that they could afford a title loan and a registration loan at the same time and have it paid off in two months. Both loans would allow enough money to pay the pet deposit and moving costs. They were able to move into their dream rental with a big yard for their dogs.</p>
<p id=”how-many11″ style=”text-align:center;”><img alt=”How Can I Benefit From Two Title Loans?” src=”https://www.cash1loans.com/portals/0/images/blog/loans/how-can-i-benefit-from-two-title-loans.png” width=”200″ /></p>
<h2>How Can I Benefit From Two Title Loans</h2>
<h3>More Money</h3>
<p>The most significant benefit of getting a title loan is that it enables you to borrow more quickly. Title loans are usually processed on the same day, sometimes in as little as 15 minutes. This is because it is a simple process involving the lender looking at your car to make sure it is worth the amount you need to borrow.</p>
<h3>Easy, Fast Approval</h3>
<p>There are high approval rates with car title loans. Lenders use your car title as collateral to guarantee the loan. The risk of giving you money is lower because the lender can legally repossess your car if you default on your loan.</p>
<h3>Keep Your Vehicle></h3>
<p>Another benefit is that you get to keep the car and still drive it while you have the loan out. You will give your title to the lender, but you can still drive. There’s no inconvenience, and you get your money.</p>
<h3>Bad Credit Okay</h3>
<p>Because a title loan is a <a href=”https://www.cash1loans.com/title-loans/secured-loans.aspx” target=”_blank”>secured loan</a>, your loan is based on a piece of collateral that you are putting up – So you can have bad credit or no credit at all.</p>
<h3>No Prepayment Penalties</h3>
<p>There are no prepayment penalties, so you can pay off the entire loan as early as you can. If you can pay off your loan early, less interest will accrue than if you continue with the payment plan options.</p>
<p id=”how-many12″ style=”text-align:center;”><img alt=”What Are the Drawbacks?” src=”https://www.cash1loans.com/portals/0/images/blog/loans/what-are-the-drawbacks.png” width=”200″ /></p>
<h2>What Are the Drawbacks?</h2>
<h3>Can You Afford Another Loan?</h3>
<p>Consider your budget before you apply for another loan. You must be confident in your ability to repay the loan on or before its due date.</p>
<h3>You Could Lose Your Vehicle</h3>
<p>You risk losing your car if you don’t make your payments. If you <a href=”/blog-news/what-happens-if-you-default-on-a-title-loan.aspx” rel=”noopener” target=”_blank”>default on your loan</a>, the lender has the right to <a href=”/blog-news/title-loan-repossession-laws.aspx” rel=”noopener” target=”_blank”>repossess your vehicle</a>. They will then sell it to pay off what you owe. If the proceeds from the sale of your vehicle are less than the amount of your remaining balance, you still have to pay the difference.</p>
<h3>Some Lenders Have Short Loan Terms</h3>
<p>Some title loan lending terms are for short periods. You’ll want to research and find lenders that have longer repayment periods that allow you the time to pay off your loan.</p>
<h3>Temptation to Overspend</h3>
<p>With easy access to cash, you might be tempted to get a loan that you don’t need. Think about the risks and don’t get loans for frivolous reasons such as expensive clothing, shoes, or purses.</p>
<p id=”how-many13″ style=”text-align:center;”><img alt=”What Are My State’s Title Loan Laws?” src=”https://www.cash1loans.com/portals/0/images/blog/loans/what-are-my-states-title-loan-laws.png” width=”200″ /></p>
<h2>What Are My State’s Title Loan Laws?</h2>
<p>Title Loan laws, interest rates, and repayment terms vary from state to state. For example, a <a href=”https://www.cash1loans.com/title-loans/nevada-title-loans.aspx” rel=”noopener” target=”_blank”>Nevada title loan</a> only allows a term of up to 210 days. An <a href=”https://www.cash1loans.com/title-loans/arizona-title-loans.aspx” rel=”noopener” target=”_blank”>Arizona title loan</a> will let you get a loan for up to 18 months (24 to 36 months for larger loans). Research the title loan laws in your state before you sign a contract. The list below will help you get started.</p>
<div class=”row”>
<div class=”column” style=”background-color:#ffffff; height: auto!important;”>
<p><a href=”https://www.sapling.com/6820766/alabama-laws-title-loans” rel=”noopener” target=”_blank”>Alabama Title Loan Laws</a></p>
<p><a href=”https://titlelo.com/learn/arizona-title-loan-laws/” rel=”noopener” target=”_blank”>Arizona Title Loan Laws</a></p>
<p><a href=”https://delcode.delaware.gov/title5/c022/sc05/index.html” target=”_blank”>Delaware Title Loan Laws</a></p>
<p><a href=”https://dbf.georgia.gov/pawnshops-title-pawn” rel=”noopener” target=”_blank”>Georgia Title Loan Laws</a></p>
<p><a href=”https://legislature.idaho.gov/statutesrules/idstat/title28/t28ch46/sect28-46-504/” rel=”noopener” target=”_blank”>Idaho Title Loan Laws</a></p>
<p><a href=”https://www.drive-safely.net/illinois-title-loans/” rel=”noopener” target=”_blank”>Illinois Title Loan Laws</a></p>
<p><a href=”https://loans.org/auto/studies/car-title-state-laws” rel=”noopener” target=”_blank”>Indiana Title Loan Laws</a></p>
<p><a href=”https://titlelo.com/learn/mississippi-title-loan-laws/” rel=”noopener” target=”_blank”>Mississippi Title Loan Laws</a></p>
<p><a href=”https://missourititleloansinc.com/consumer-disclosures” rel=”noopener” target=”_blank”>Missouri Title Loan Laws</a></p>
</div>
<div class=”column” style=”background-color:#ffffff;height:auto!important;”>
<p><a href=”/blog-news/title-loan-laws-nevada.aspx” rel=”noopener” target=”_blank”>Nevada Title Loan Laws</a></p>
<p><a href=”http://gencourt.state.nh.us/rsa/html/XXXVI/399-A/399-A-mrg.htm” rel=”noopener” target=”_blank”>New Hampshire Title Loan Laws</a></p>
<p><a href=”https://titlelo.com/learn/title-loan-laws/” rel=”noopener” target=”_blank”>New Mexico Title Loan Laws</a></p>
<p><a href=”https://www.ustatesloans.org/law/nd/” rel=”noopener” target=”_blank”>North Dakota Title Loan Laws</a></p>
<p><a href=”https://www.sapling.com/6866129/tennessee-law-title-loans” rel=”noopener” target=”_blank”>Tennessee Title Loan Laws</a></p>
<p><a href=”https://www.texasfairlending.org/resources/faqs/” rel=”noopener” target=”_blank”>Texas Title Loan Laws</a></p>
<p><a href=”https://le.utah.gov/xcode/Title7/Chapter24/C7-24_1800010118000101.pdf” rel=”noopener” target=”_blank”>Utah Title Loan Laws</a></p>
<p><a href=”https://www.valegalaid.org/issues/consumer/payday-and-car-title-loans” rel=”noopener” target=”_blank”>Virginia Title Loan Laws</a></p>
<p><a href=”https://www.titleloans-wisconsin.com/blog/wisconsins-title-loan-laws/” rel=”noopener” target=”_blank”>Wisconsin Title Loan Laws</a></p>
</div>
</div>
<p id=”how-many14″ style=”text-align:center;”><img alt=”What Are My Alternatives to Getting Two Title Loans?” src=”https://www.cash1loans.com/portals/0/images/blog/loans/what-are-my-alternatives-to-getting-two-title-loans.png” width=”200″ /></p>
<h2>What Are My Alternatives to Getting Two Title Loans</h2>
<p>Most other types of loans that are <a href=”/blog-news/what-are-title-loan-alternatives.aspx” rel=”noopener” target=”_blank”>title loan alternatives</a> will require credit checks for you to be approved. These loans are very different from title loans, and when you are looking to get money quickly, you must understand how these loans differ to decide what option is best suited for your current situation.</p>
<ol>
<li>Line of Credit</li>
<li>Personal Loan</li>
<li>Short-Term Business Loan</li>
<li>Peer To Peer Loans</li>
<li>Credit Card Cash Advance</li>
<li>Loans from Friends or Family</li>
<li>Extra Part-Time Job</li>
<li>Local Churches and Charities</li>
<li>Call Your Landlord or Utility Company</li>
<li>Paycheck Advance</li>
</ol>
<p id=”how-many15″> </p>
<h2>FAQs</h2>
<h3>Can I Have Two Names on One Car Title at the Same Time?</h3>
<p>Yes, you might be able to get a title loan with your name on the title along with anyone else’s. Two names on the title imply two people registering and owning the vehicle together. How the names appear on a title is essential in determining how CASH 1 processes the loan. When “AND” or “AND/OR” or “OR” join the parties’ names, both parties need to sign the agreement acknowledging the loan/lien if only one party is going to be financially responsible for the payments.</p>
<h3>How Much Money Can I Borrow With a Title Loan?</h3>
<p>At CASH 1, you can get from $100 to $50,000 for a title loan in Arizona or Nevada. We determine your loan amount based on the value of your vehicle and your ability to repay. We offer title loans up to $50,000, and we take great pride in offering the underbanked a solution and being part of your financial success.</p>
<h3>How Long Do I Have to Pay Back My Title Loan?</h3>
<p>You get up to 18 months in Arizona to repay and six months in Nevada with low, fixed-rate payments due on your pay dates. Are you worried about missing your payment dates? You can set up automated payments with us.</p>
<p>Whichever loan term you choose, you are free to pay that loan off early with no additional fees or penalties. We encourage you to make early or more prominent payments that will save you a significant amount of money.</p>
<h3>What Happens if I Miss a Payment on My Title Loan?</h3>
<p>The cost of missed payments can often snowball and make it difficult to complete future payments. A title loan doesn’t affect your credit score (in either direction), but your credit can be damaged if you default on your loan and your vehicle is repossessed. If you are late on a payment, you need to have open communication with your lender. You might be able to work out a refinance or receive an extension.</p>
<h3>Can I Drive My Car With a Title Loan?</h3>
<p>Yes. Once you are approved, you give us the title of your vehicle that you get back when your loan is paid in full. You still retain possession of your vehicle and continue to drive your vehicle while you pay off your loan.</p>
<h3>Do I Need a Clear Title?</h3>
<p>Yes. You are not considered the car owner when you don’t have a clear and free title in your name.</p>
<p>However, if you are making payments on your car, our loan officers can help you get an alternative registration loan that doesn’t require a title in hand.</p>
<h3>What’s the Difference Between Registration Loans and Title Loans?</h3>
<p>Registration loans work similarly to title loans because you use your car as collateral in exchange for money. With a title loan, you trade your clear car title for money. Registration loans use your car registration as collateral for the loan. Using your vehicle’s registration is beneficial if you are still making payments on your vehicle.</p>
<h3>Can I Get a Registration Loan if You Have a Title Loan?</h3>
<p>If you have another vehicle that you are making payments on, you can get a registration loan. You cannot get a registration loan and a title loan on the same car.</p>
<p id=”how-many16″ style=”text-align:center;”><img alt=”What Are My Options If I Need a Second Title Loan?” src=”https://www.cash1loans.com/portals/0/images/blog/loans/what-are-my-options-if-i-need-a-second-title-loan.png” width=”200″ /></p>
<h2>What Are My Options If I Need a Second Title Loan?</h2>
<p>CASH 1 offers a few different options if you need a second title loan:</p>
<h3>Title Loan On a Different Vehicle</h3>
<p>If you have another vehicle with a clear title, you could get up to $50,000 using your vehicle title as collateral.</p>
<h3>Requirements</h3>
<ol>
<li>Arizona or Nevada Resident</li>
<li>18 Years of Age or Older</li>
<li>Government-Issued ID</li>
<li>Proof of Income</li>
<li>A Clear Title for Your Vehicle</li>
<li>Your Car, Truck, RV, or Motorcycle (for Brief Inspection)</li>
<li>Not on Active Duty in the Military</li>
</ol>
<h3>Registration Loan On a Different Vehicle</h3>
<p>If you’re still making payments on your vehicle and have <a href=”/blog-news/what-equity-car.aspx” rel=”noopener” target=”_blank”>equity in your car</a>, you can get a loan up to $5,000 using your registration. There is no title required for this type of loan.</p>
<h3>Requirements</h3>
<ol>
<li>Arizona or Nevada Resident</li>
<li>18 Years of Age or Older</li>
<li>Government-Issued ID</li>
<li>Proof of Income</li>
<li>Vehicle Registration</li>
<li>Your Car, Truck, RV, or Motorcycle (for Brief Inspection)</li>
<li>Not on Active Duty in the Military</li>
</ol>
<h3>Title Loan Buyout or Refinance Your Current Loan</h3>
<p>Maybe you don’t need another title loan and only want more money from your existing title loan. Refinancing can allow you the option of lower payments and getting more money.</p>
<h3>Requirements</h3>
<ol>
<li>Arizona or Nevada Resident</li>
<li>18 Years of Age or Older</li>
<li>Government-Issued ID</li>
<li>Proof of Income</li>
<li>Existing Title Loan for Your Vehicle</li>
<li>Your Car, Truck, RV, or Motorcycle (for Brief Inspection)</li>
<li>Not on Active Duty in the Military</li>
</ol>
<p id=”how-many17″ style=”text-align:center;”><img alt=”Why Should I Choose CASH 1?” src=”https://www.cash1loans.com/portals/0/images/blog/loans/why-should-i-choose-cash-1.png” width=”200″ /></p>
<h2>Why Should I Choose CASH 1?</h2>
<p>Since 1997, CASH 1 has been in business, helping our community get the funding they need – Even with bad credit. Our years of experience can have your new loan approved in as little as 15 minutes. When you do business with us, you can count on our representatives to educate and respect your needs throughout the process.</p>
<ul>
<li>Our application process is fast and straightforward</li>
<li>Flexible loan repayment plans</li>
<li>Respectful and knowledgeable loan specialists</li>
<li>Quick approval process</li>
</ul>
<p id=”#how-many18″> </p>
<h2>Where Are CASH 1 Locations?</h2>
<p>We have stores conveniently located in Nevada and Arizona.</p>
<h3>Las Vegas Locations</h3>
<p><img alt=”CASH 1 Las Vegas Locations” src=”https://www.cash1loans.com/portals/0/images/blog/loans/how-many-title-loans-can-i-get-in-las-vegas.png” width=”735″ /></p>
<p>If you live in Arizona, stop by one of our Phoenix, Glendale, Mesa, Tempe, Chandler, or Goodyear locations.</p>
<h3>Reno Locations</h3>
<p><img alt=”CASH 1 Reno Locations” src=”https://www.cash1loans.com/portals/0/images/blog/loans/how-many-title-loans-can-i-get-in-reno.png” width=”735″ /></p>
<p>Northern Nevada residents can get a loan at the Reno store.</p>
<h3>Phoenix Locations</h3>
<p><img alt=”CASH 1 Phoenix Locations” src=”https://www.cash1loans.com/portals/0/images/blog/loans/how-many-title-loans-can-i-get-in-phoenix.png” width=”735″ /></p>
<p>If you live in Arizona, stop by one of our Phoenix, Glendale, Mesa, Tempe, Chandler, or Goodyear locations.</p>
<p class=”align-c” style=”text-align: center;”><br />
<a class=”btn-find-location” href=”/locations.aspx” style=”color: #fff!important;” title=”Find a CASH 1 Location”><i class=”fas fa-map-marker-alt” aria-hidden=”true”></i> Find a location</a></p>
<p>Getting payday loans can leave you taking one out, failing to pay it back, and <a href=”/blog-news/payday-loans-interest-rate.aspx” rel=”noopener” target=”_blank”>racking up interest</a>. The state of Missouri recognizes payday loan providers as legitimate businesses. Not only are they legitimate in the state, but they have managed to flourish here for almost two decades.</p>
<p>Here’s an overview of the payday loan laws in Missouri, their regulations, and what happens when you cannot repay them.</p>
<h2>Missouri Payday Loans and Regulations</h2>
<p>Missouri has some of the softest laws concerning payday loans throughout the United States. Thanks to their lenient laws, payday loans have been able to thrive. Of course, there are some limitations on payday lenders through various regulations.</p>
<h3>License Requirement</h3>
<p>Payday lenders are legal entities throughout the state thanks to <a href=”https://www.law.cornell.edu/regulations/missouri/20-CSR-1140-11-030″ rel=”noopener” target=”_blank”>Mo. Rev. Stat. 408.500 et seq</a>. Therefore, they can perform their operations as long as they have a license, courtesy of Missouri’s Division of Finance.</p>
<p>Lenders must display their license front and center. Information about the lender and their business should accompany their license. Moreover, according to <a href=”https://www.law.cornell.edu/regulations/missouri/20-CSR-1140-11-030″ rel=”noopener” target=”_blank”>20 CSR 1140-11.030 (2)</a>, the lender will also provide the Division of Finance. This information can include the phone, address, and name of the government entity.</p>
<h3>Copy of Agreement Laws</h3>
<p>Provision 20 CSR 1140-11.030 (5) states that the lender must provide the borrower a copy of the agreement. This agreement will contain all the relevant information about their payday lending transactions.</p>
<p>The copy of the transaction will also include a list of the terms and conditions for the short-term loan. The borrower will have to read through the entire agreement carefully and then sign it if they agree. Customers also hold the right to cancel the contract by the next business day’s end, and there will be no extra charge.</p>
<h3>Charges and Interest Rate Laws</h3>
<p>Provision 408.500.4 clearly states that the lender must provide the borrower with clear information about their interest rates. But other than their interest rates, they will also have to make clear the short-term nature of the loans. Lenders will also have to provide information about lending transactions to the borrower to make an educated decision.</p>
<h3>Keeping Information and Ledgers</h3>
<p>20 CSR 1140-11.040 (2), 20 CSR 1140-11.040 (3), and 20 CSR 1140-11.040 (4), are all laws that force lenders to keep a record of their transactions. These records can include an individual account ledger, a profit and loss statement, a trial balance sheet, a general ledger, and a cash journal.</p>
<p>20 CSR 1140-11.040 (5) states that they will have to maintain these records. It also allows the examiner to access them on short notice.</p>
<p>20 CSR 1140-11.040 (6) prohibits lenders from deleting individual account ledgers. And 20 CSR 1140-11.040 (8) forces them to provide borrowers with paid notes for their transactions.</p>
<h3>Ceasing Operations and Shutting Down</h3>
<p>Before a payday lender can cease their operations, they will have to provide an official statement to the Division of Finance. More importantly, they will have to inform the division at least ten days before shutting down.</p>
<p>Before they finally close down, the company must hand in their license along with a letter that explains their decisions. The Division of Finance will also receive a list of the remaining receivables and their current locations.</p>
<h3>Loan Amount</h3>
<p>408.500.1 Specifically states that the company’s payday loans cannot exceed $500. They can either be $500 or less. While they can only provide a single loan at a time to borrowers, they can charge fees and interest as they please.</p>
<p>The <a href=”https://www.law.cornell.edu/regulations/missouri/20-CSR-1140-11-030″ rel=”noopener” target=”_blank”>Mo. Rev. Stat. 408.500 et seq</a> bill received various amendments in 2006. One of the significant changes that came with the new bill was the inclusion of 6 roll-overs. Borrowers will receive a total of 6 roll-overs from their lenders, as long as they reduce the principal amount of the agreement by 5%.</p>
<h3>Fees, Interest, and Maximum Term</h3>
<p>Both interest and fees cannot exceed 75% of the initial amount, according to 408.505.3. Therefore, interest and other fees cannot exceed this percentage throughout the payday loan life.</p>
<p>Due to this law, Missouri has the highest APR throughout the US. In fact, in some cases, the APR rose to 1950%; and in 2019, borrowers had to face an interest rate of 443%. 443% is also the average rate for a payday loan that amounts to $300, according to the <a href=”https://www.responsiblelending.org/sites/default/files/nodes/files/research-publication/crl-payday-rate-cap-map-feb2019.pdf” rel=”noopener” target=”_blank”>Center for Responsible Lending</a>.</p>
<p>The maximum term for any payday loan can range between 14 and 31 days in Missouri. If the borrower does not pay them back, they will be subject to various fees and interest charges.</p>
<h3>Specific Cases for Criminal Action against Borrowers</h3>
<p>The state allows lenders to take criminal action against clients if they close their accounts before repaying the total amount. Criminal action is also justifiable if they stop payments on their cheque.</p>
<h2>What Happens When You Cannot Repay Them</h2>
<p>Defaulting on your payday loans can lead to a slew of serious issues, fines, lawsuits, threats, and even a reduced credit score. Now you think this may be a little excessive for just $300; the worst is yet to come.</p>
<p>Payday lenders can be outright ruthless in chasing down their debtors and ensuring that they get their money back. Here is what to expect when you cannot repay your loan from a payday lender.</p>
<h3>Threats for Jail Time</h3>
<p>Payday lenders cannot send you to jail for not paying them back. It is quite the opposite. Payday lenders cannot threaten their clients into paying them their money. These threats can be about sending borrowers to jail or having them arrested. 408.505.8 protects customers from their threats.</p>
<p>However, most payday lenders still tend to threaten individuals and even go so far as to file criminal complaints against borrowers. They do this by abusing bad-check laws, which judges usually accept without second-guessing.</p>
<p>Fortunately, this is illegal, and there are protections in place to protect customers if they face these charges. The Consumer Financial Protection Bureau has advised borrowers facing these threats to contact the office of their state attorney general. They also insist that the borrower should not miss a day in court, even if the lender wrongly filed the complaint.</p>
<h3>The Court Can Summon You</h3>
<p>Payday loan companies will go to any length to retrieve their money from you. They can even file a bad check complaint, which can force you to appear in court. While you might think that this is taking things too far, this is routine for them.</p>
<p>But the critical thing to remember here is that you should not miss a court summon. If you fail to appear in court, the judge will make a default judgment in favor of the payday lender. And if that happens to you, the court can start collecting debts from you on behalf of the payday lenders. So even though you could not go to jail before, there is a real possibility of jail time now.</p>
<p>Therefore, whatever you do, do not miss your court summon. Even if they wrongfully implicate you, you can still minimize the damage by showing up in court. You should also contact the attorney general’s office before going to court so that they can help you settle the matter.</p>
<h3>Opening the Table to Negotiations</h3>
<p>Payday lenders do not want to sell your debt to another collections agency. They want you to pay them back as much as you want them to leave you alone. Therefore, they will offer you the chance to negotiate the terms and conditions of their contract. They will also ask you how you would like to pay them back and reach a middle ground.</p>
<p>They will try their best to work towards getting a payment out of you. And the best way that you can deal with it is by telling them that you are <a href=”https://www.ovlg.com/bankruptcy” rel=”noopener” target=”_blank”>considering bankruptcy</a>. The thing is: they cannot pressure you any further now. If you go through with bankruptcy, the payday lender will not get anything. Try to reach an agreement with them where they exhaust your debt and settle the account.</p>
<h2>Final Thoughts</h2>
<p>Having to take out a payday loan can be a very stressful experience. If you cannot pay back the amount you owe, you will face legal consequences. <a href=”/personal-line-of-credit-loans/missouri.aspx” rel=”noopener” target=”_blank”>A personal line of credit in Missouri</a> or an <a href=”/locations/missouri-online-loans.aspx” rel=”noopener” target=”_blank”>online loan in Missouri</a> are popular alternatives to payday loans to get you the emergency funds you need.</p>
<p> </p>
<p><strong>Author Bio:</strong></p>
<p><a><img alt=”Attorney Lyle Solomon” src=”/Portals/0/Images/blog/loan-laws/lyle-solomon.png” width=”149″ /></a></p>
<p>Lyle Solomon is a licensed attorney who has been affiliated with law firms in California, Nevada, and Arizona since 1991. As the principal attorney of <a href=”https://www.ovlg.com/” rel=”noopener” target=”_blank”>Oak View Law Group</a>, he gives advice and writes articles to help people solve their debt problems</p>
<p> </p>
<h2>How Personal Loans Work</h2>
<p><a href=”https://www.cash1loans.com/blog-news/what-personal-loan.aspx” target=”_blank”>Personal loans</a> are installment loans, which means you can borrow a fixed amount of cash and pay back a set monthly amount with interest over the loan term. <a href=”/personal-loans.aspx” rel=”noopener” target=”_blank”>Personal loans</a> tend to range from about 12 to 84 months.</p>
<p>After paying your loan in full, your account will automatically be closed. However, if you still need more money, you can always apply for a new loan.</p>
<p>It is vital to know that loan amounts typically vary from lender to lender. The amount tends to range from $1,000 to $100,000, depending on different factors. Most of the time, the loan amount you are qualified for will be mostly based on your credit status.</p>
<h2>What Lenders Look For In Your Application</h2>
<p>Placing your best foot forward in applying for a personal loan can be pretty challenging, especially when you don’t know what lenders need from you. Below are the factors that lenders look into to decide if you are qualified to take a loan or not.</p>
<h3>Credit Score</h3>
<p>Most lenders will look at your credit reports and credit score. It gives them an idea of how well you managed the money you borrowed in the past. If you have a poor credit history, the lender might look at your loan application as a potential risk of default. It scares them off as it puts them at risk of not getting their money back.</p>
<p>The higher your credit score, the better your chances of getting your loan application approved. To get better loan deals, the best <a href=”https://www.creditninja.com/what-credit-score-is-needed-for-a-personal-loan/” rel=”noopener” target=”_blank”> credit score for a personal loan</a> ranges from 700 to 800.</p>
<h3>Income and Employment History</h3>
<p>Lenders need to ensure that you can pay back the money they will lend you. So, they need to evaluate if you have consistent and sufficient income. Most of the time, the income requirements depend on the amount you borrow. Besides that, lenders will also require you to show steady employment proof.</p>
<h3>Debt-To-Income Ratio</h3>
<p>The debt-to-income ratio is the percentage of your monthly debt compared to your monthly income. Lenders prefer borrowers with a low debt-to-income ratio. So, if you have a debt-to-income ratio higher than 43%, most lenders will reject your loan application.</p>
<p>You might still get a loan even with a high debt-to-income ratio. However, this needs to be accompanied by a good credit score and a reasonably high income. If you’d like to increase your chances of loan approval, lower your debt-to-income ratio by paying down outstanding debts asap.</p>
<h3>Collateral</h3>
<p>Some personal loans might require you to pledge collateral. These loans are known as <a href=”/title-loans/secured-loans.aspx” rel=”noopener” target=”_blank”> secured loans</a>, and they usually have lower interest rates than unsecured loans.</p>
<p>The value of the collateral also determines how much you can borrow. For example, when you buy a car, you cannot borrow more than the car’s current value. It is because the lender needs to be sure that you will repay your loan amount.</p>
<h3>Down Payment</h3>
<p>Some lenders would require you to give a down payment. The size of your down payment will determine how much you can borrow. For example, if you buy a car, paying more in down payment means you won’t need more cash to borrow. In most cases, you can take out a loan without a down payment. However, you should know that you might end up paying more in interest.</p>
<h3>Liquid Assets</h3>
<p>Lenders would also like to see if you have any money market account or cash in savings. It assures the lenders that even if you experience a temporary setback, such as losing a job, you will still repay your loan.</p>
<h3>Loan Term</h3>
<p>Lenders would want to lend you money for a shorter loan term, with which you will more likely pay it back shortly. However, it is vital to know that a shorter loan term means a higher monthly payment.</p>
<p>If you pick a shorter loan term, you will pay interest for only a few years. On the other hand, if you choose to get a longer term, you will pay lower monthly payments and pay interest for a couple of years.</p>
<h2>In Conclusion</h2>
<p>Many people resort to taking out personal loans to pay for their needs. So, if you plan to get one, it is best to know what lenders look for when it comes to approval. That way, you can prepare for your personal loan application in advance.</p>
<p><strong>Author Bio:</strong></p>
<p><img alt=”Finance Blogger David Owens” src=”/Portals/0/Images/blog/loans/david-owens.png” width=”149″ /></p>
<p>David Owens is a seasoned content writer specializing in finance – debt management, entrepreneurship, and business finance. When not writing, he travels with his cat, Mellie.</p>
<p>Loans often come with a lot of terms and stipulations regarding how you can use them; if you need something that offers a bit more flexibility and freedom, you might want to consider taking out a personal or business line of credit.</p>
<p>What is the difference between a line of credit and a loan, and which one is right for you? This guide will tell you everything you need to know.</p>
<h2>How Does a Personal Line of Credit Work?</h2>
<p>A line of credit is when you take out a fixed amount of money from a bank or lending institution. You can draw upon this money as needed to pay for different personal expenses.</p>
<h2>Repayment Structures</h2>
<p>In many ways, a line of credit (LOC) functions like a credit card. If you take out a line of credit for $50,000, but you don’t use the money, you won’t pay any interest. Let’s say a few months later you use $10,000 to get a new car. You will then only need to pay interest on the $10,000. The repayment structure is also similar to a credit card. Each month the lending agency will send you a statement with your balance, interest summary, and minimum payment due. To remain in good standing and avoid the risk of having your LOC revoked, you will be expected to pay the minimum every month.</p>
<h2>Secured vs. Unsecured</h2>
<p>A line of credit can be taken out in one of two ways. Having a secured LOC entails using collateral, such as your home or business. These often come with lower interest rates because the lending institution can take over your property should you default on repayment.</p>
<p>An unsecured line of credit has higher interest rates because there the lender has nothing to seize should you be unable to pay back the line of credit. This type of LOC is often more challenging to obtain. When seeking an unsecured line of credit, you will need to show proof of exceptional credit.</p>
<h2>Pros of a Personal LOC</h2>
<p>There are many benefits for <a href=”https://www.cash1loans.com/personal-line-of-credit-loans.aspx” rel=”noopener” target=”_blank”>getting a personal line of credit</a>, the most obvious being flexibility. This is across all areas of the borrowing process, including repayment, usage, and the amount.</p>
<p>With a credit line, you only borrow what you need, rather than being limited to a fixed amount. It’s ideal for long-term projects or expenses where you are unsure of the final costs. It is also an excellent option for temporarily supplementing your funds during an unanticipated life event or emergency.</p>
<p>Getting your money is quick and easy. Once you are approved for a LOC, you will have unlimited access to your available funds. This allows you to use them as needs arise, rather than applying each time you need cash.</p>
<p>A line of credit is also a renewable source of funds. Going back to the car example, once you pay back the $10,000 you borrowed, you will once again have a $50,000 credit limit.</p>
<h2>Cons of a Personal LOC</h2>
<p>There are a few downsides when taking out a personal line of credit. Even with a secure line of credit, interest rates are often higher than you would get with a personal loan. They also tend to have variable rates vs. fixed Annual Percentage Rates (APR). Which means you could end up paying back more than you originally intended.</p>
<p>Accounts come with annual service fees, regardless of whether you are using the money or not.</p>
<p>In addition, they aren’t the best option for people with poor spending habits as they allow flexibility for overspending. Although they can be used as a short-term cash supplement, this is often a dangerous line to walk and unsuitable for achieving long-term financial stability.</p>
<h2>Personal Line of Credit vs. Loan</h2>
<p>Loans and credit lines are types of debt issued by banks or lending agencies. Both loan and <a href=”https://www.cash1loans.com/blog-news/types-of-lines-of-credit.aspx” rel=”noopener” target=”_blank”>line of credit types</a> depend upon the intended use, your financial standing, and credit history. Your relationship with the lending institution will also play a role in what is available to you.</p>
<p>Loans are granted for one-time usage and have a fixed repayment term, whereas lines of credit can be used when and how you please. With credit lines, lending agencies monitor your usage and credit status. If you haven’t used your LOC in some time, they could reduce or close it.</p>
<p>Like LOCs, loans can be secured or unsecured. All <a href=”https://www.cash1loans.com/blog-news/unsecured-personal-loans.aspx” rel=”noopener” target=”_blank”>personal loans are unsecured</a> because they are not backed by collateral. In contrast, a home or car loan is classified as a secure loan and often includes stipulations on how you can and cannot spend money.</p>
<p>If you take out a home loan for $500,000 but only end up using $450,000, you won’t be able to spend the other $50,000 getting a new car.</p>
<p>A personal loan provides the freedom to use the money as you see fit. However, since you have to take the entirety of the loan at once, you will be incurring fees from day one. Even if most of the money is sitting in your bank account waiting to be used, you will be expected to pay the minimum principal and interest fees every month.</p>
<p>With a line of credit, you will have a bit more freedom and only pay fees on what you use. Even a secure line of credit is not linked to a specific purpose and is great for everyday use and unexpected emergencies.</p>
<h2>When to Apply for a Personal Line of Credit</h2>
<p>There are three primary reasons to apply for a personal line of credit vs. a loan.</p>
<p><strong>1. You’re not sure how much money you’ll need </strong></p>
<p>Sometimes, you might not be able to predict how much everything is going to cost. A personal line of credit gives you the financial flexibility to use what you need rather than being tied down to a specific amount. They are also a great way to <a href=”https://www.cash1loans.com/blog-news/debt-consolidation-utah.aspx” rel=”noopener” target=”_blank”>consolidate your debt</a>.</p>
<p><strong>2. Your expenses may be spread out over the years </strong></p>
<p>You might have many different expenses coming up, such as home improvement projects or a significant life event like a wedding. A line of credit is something that you can access over and over. Use it for one expense, pay it off, and have the entire amount ready for the next thing life throws your way.</p>
<p><strong>3. Your credit is in good condition</strong></p>
<p>If you plan to apply for an unsecured personal line of credit, it is vital to have good credit. Having <a href=”https://www.cash1loans.com/blog-news/bad-credit-line-of-credit.aspx” rel=”noopener” target=”_blank”>bad credit</a> will affect your ability to get approved and leave you paying steep interest rates.</p>
<h2>When to Apply for a Personal Loan</h2>
<p>Depending on your situation, getting a personal loan might be the better option. Here are two reasons to consider getting a loan.</p>
<p><strong>1. You know how much you need to borrow</strong></p>
<p>Let’s say you have hired a company to remodel your kitchen. You know exactly how much everything will cost and have no other expenses coming up that require extra cash. Loans come with more flexibility in how much you can borrow at once and lower repayment rates.</p>
<p><strong>2. You want to limit the amount of debt you take on</strong></p>
<p>If you know that you tend to overspend when money is available, a loan might be the better option. The money focuses on one expense versus allowing flexibility which could lead to additional spending. Loans also tend to have fixed interest rates and less of an immediate impact on your overall credit score.</p>
<h2>Business Line of Credit vs. Loan</h2>
<p>A business line of credit is very similar to a personal line of credit. The main difference is that it is intended for short-term needs. You can use a business line of credit as needed, so long as you faithfully pay your monthly minimum and any associated annual fees.</p>
<p>Business LOCs are an excellent option for startups that need to have flexibility regarding cash flow. If your business is already established and you’re looking for a more extensive credit line, you can put up collateral to get a secured line of credit. This might include business real estate, additional fleet vehicles, or inventory.</p>
<p>One business line of credit and loan difference is a loan is designated for a specific purpose. Long-term loans are geared towards investments and other expenses that take time, such as an office remodel. Short-term business loans have a quick repayment schedule and are intended for immediate needs, such as building up inventory.</p>
<h2>When You Should Apply for a Business Line of Credit</h2>
<p>There are a few factors to consider when applying for a business line of credit vs loan.</p>
<p><strong>1. You need ongoing access to cash</strong></p>
<p>If your business is going through a stage of change”expansion, redesign, or restructuring”you might need to access cash with some irregularity. New expenses and unexpected costs can throw off your normal budget. A line of credit will provide you with peace of mind, knowing the cash is there should you need it.</p>
<p><strong>2. You need payment flexibility</strong></p>
<p>With a business line of credit, you will only need to worry about repaying the minimum each month. This is different from a loan where you have a principal in addition to interest and a fixed repayment term. A business LOC gives you the flexibility to focus on your business now and worry about complete repayment later.</p>
<h2>When You Should Apply for a Business Loan</h2>
<p>Business loans can be the preferred choice depending on your company’s needs and <a href=”https://www.forbes.com/sites/forbesfinancecouncil/2021/03/22/financing-your-small-business-with-small-business-loans-what-you-need-to-know/” rel=”noopener” target=”_blank”>stage of development</a>.</p>
<p><strong>1. You know how much you need to borrow</strong></p>
<p>Perhaps you are adding a new real estate holding to your business. Since you don’t require regular access to additional funds, a business loan might be the better route. Your interest rates will often be lower, and you won’t have to worry about the annual fees associated with a LOC.</p>
<p><strong>2. You want to have set repayment costs</strong></p>
<p>Business loans often come with a fixed APR. You can choose your repayment term, so you know what you’re paying overtime. This is extremely helpful when trying to budget for your business.</p>
<h2>How to Apply for a Personal Line of Credit</h2>
<p>You will need two things when you apply for a personal line of credit: your credit history and a solid credit score. Beyond that, the application process is very similar to <a href=”https://www.cash1loans.com/blog-news/how-get-personal-loan.aspx” target=”_blank”>applying for a personal loan</a>.</p>
<p>Take some time to consider which lender to borrow from. Look into their rate structure, annual fees, and lending limits. How much you can borrow will depend heavily on your credit score.</p>
<p>Once you’ve decided on a lender, it’s time to fill out the application. Many lenders will allow you to apply online or even over the phone. Once you have been approved for a line of credit, your funds will be accessible in as little as one business day.</p>
<h2>Should I Get a Loan or Line of Credit?</h2>
<p>Deciding whether to get a line of credit vs. a loan depends on why you need the money and how you intend to use it. There are pros and cons to each, including different interest rates, accessibility, and spending freedom.</p>
<p>If you are looking at long-term flexibility and unknown costs, a line of credit is a good option for you or your business. For those who know exactly where the money is going and need a stable and fixed repayment option, a personal or business loan is often the better option.</p>
<p>If you live in <a href=”https://www.cash1loans.com/personal-line-of-credit-loans/utah.aspx” rel=”noopener” target=”_blank”>Utah</a>, <a href=”https://www.cash1loans.com/personal-line-of-credit-loans/idaho.aspx” rel=”noopener” target=”_blank”>Idaho</a>, <a href=”https://www.cash1loans.com/personal-line-of-credit-loans/kansas.aspx” rel=”noopener” target=”_blank”>Kansas</a>, <a href=”https://www.cash1loans.com/personal-line-of-credit-loans/louisiana.aspx” target=”_blank”>Louisiana</a> or <a href=”https://www.cash1loans.com/personal-line-of-credit-loans/missouri.aspx” rel=”noopener” target=”_blank”>Missouri</a>, CASH 1 can help you with all your line of credit needs. Apply online or over the phone.</p>
<p>If you are part of the majority that could not cover an emergency of this size, a line of credit may help. If you already have a few lines of credit and wonder, <a href=”https://www.cash1loans.com/blog-news/how-many-lines-of-credit-should-you-have.aspx” target=”_blank”>how many lines of credit should you have?</a> Don’t worry. This guide will cover all of your questions and help you understand the different types of lines of credit.</p>
<h2>What Is a Line of Credit?</h2>
<p>A line of credit (LOC) is a type of <a href=”/blog-news/what-is-revolving-credit.aspx” rel=”noopener” target=”_blank”>revolving credit</a> that customers can use to get funds. The maximum loan amount, interest rates, payment sizes, and withdrawal amount gets determined by the lender.</p>
<p>You’ll have access to the funds in a line of credit if you don’t go over the limit and meet any requirements necessary. One of the significant factors is making your minimum payments on time.</p>
<h2>Types of Lines of Credit</h2>
<p>There are different types of lines of credit that have various benefits. The general advantages of each line of credit are flexibility, including flexible payment and financial safety.</p>
<p>LOCs are flexible because you can request any amount up to your limit without drawing the entire amount. You’ll only pay interest on the amount you draw out, not the total available amount.</p>
<p>If you continue to meet your minimum payment requirements, you can adjust how much you pay, making the repayment schedule flexible. You can pay off your whole balance or only keep up with the minimum.</p>
<p>As a general rule, you should pay as much off as you can at one time. A line of credit also works as a financial safety net if you run into trouble because of unforeseen circumstances. Until your next paycheck, you can cover the unexpected expenses with a line of credit.</p>
<p>The different lines of credit are personal, home equity, business, secured, and unsecured.</p>
<h3>Personal Lines of Credit</h3>
<p><a href=”/personal-line-of-credit-loans.aspx” rel=”noopener” target=”_blank”>Personal lines of credit</a> allow a borrower to repay the funds on a revolving basis. When applying for this type of credit, a lender will check your current credit score.</p>
<p>To qualify for a line of credit with CASH 1 Loans, you’ll need:</p>
<ol>
<li>To be a resident of the state where you apply</li>
<li>To be 18 Years of Age or Older</li>
<li>To have an Open Checking Account</li>
<li>To have Proof of Income</li>
<li>Not to be on Active Duty in Military</li>
</ol>
<p>A personal line of credit is used when you face an emergency issue. If you need something dealt with right away but don’t have the necessary funds, you’ll likely opt for a personal line of credit.</p>
<h3>Home Equity Lines of Credit</h3>
<p>Home equity lines of credit (HELOC) is a form of available secured credit because you’ll offer your house as collateral. Your available credit gets determined by the amount of equity in your home.</p>
<p>You can borrow as much as you need up to that available limit. The maximum is usually around 80% of what your home is valued at, minus how much you currently owe on the mortgage (otherwise known as equity).</p>
<p>After the draw period is over, the balance you used is due, and repayment begins. You’ll typically have ten years or less before reaching the draw period.</p>
<p>There are some additional costs to getting a HELOC. For example, the cost of getting your home appraised is factored in.</p>
<p>This line of credit is best used for large expenses or to consolidate debt that you already have with high interest rates. Many opt for this line of credit to help with debt because of the low interest rates and tax benefits.</p>
<p>The line of credit is only tax-deductible on the interest paid. HELOC money must also improve, build, or purchase the home up for collateral to be tax-deductible.</p>
<h3>Business Lines of Credit</h3>
<p>A business line of credit is used for businesses. Shocker, right? Instead of taking out a separate high-interest loan, a business owner can borrow money when needed through a line of credit. The lender bases the amount given on the profitability of the business.</p>
<p>A lender will also check the market value of the business and any risks to determine specific loan details. Business owners can benefit by taking out money when they need it without getting approval from the lender.</p>
<p>This line of credit is flexible in the world of business. You can use it on inventory, equipment, services, or any other business expense.</p>
<h2>Secured vs. Unsecured Lines of Credit</h2>
<p>Chances are, you already have a form of secured or unsecured line of credit. The differences are as follows:</p>
<h3>Secured Credit</h3>
<p>To receive a secured line of credit, you must offer up collateral. A typical example of these loans is a car or home loan. If you fail to make payments and cover your debt, the lender has the right to seize the asset you put up for collateral.</p>
<p>These loans have lower interest rates and higher amounts than unsecured LOCs because it is less risky for the lender. This is their way of securing payment in advance.</p>
<h3>Unsecured Credit</h3>
<p>Most lines of credit are unsecured, meaning you don’t offer up any collateral to the lender. Since this is a risk for the lender, they will make interest rates higher.</p>
<p>Credit cards are the most common type of unsecured line of credit. Your credit limit is how much you can borrow. You’ll only pay interest on the amount you use.</p>
<p>A lender cannot take anything from you as collateral if you fail to make payments on a credit card or another unsecured line of credit. However, your credit score will start to decrease.</p>
<h2>Open-End vs. Closed-End Credit</h2>
<p>The different lines of credit will fall into one of two categories; open-end/revolving credit or closed-end credit. They differ in the following ways:</p>
<h3>Open-End/Revolving Credit</h3>
<p>Open-end/revolving credit lets a borrower take out amounts during the draw period. They can make payments throughout the life of the loan. Credit cards, HELOCs, and personal lines of credit are all great examples of an open-ended credit product. When an amount of available credit gets withdrawn and repaid, the money is available to borrow again.</p>
<p>Because of this, an open-ended credit line is mainly used to fund needs that cost a lot of money over a long-term time frame. This line of credit has its advantages, but keeping the product open may come with fees.</p>
<h3>Closed-End Credit</h3>
<p>Otherwise known as an <a href=”https://www.cash1loans.com/installment-loans/installment-loan-guide.aspx” target=”_blank”>installment loan</a>, a closed-end line of credit allows the borrower to get a specific lump sum amount. This is used for something that needs payment upfront.</p>
<p>Many use it for a specific purpose, making it less flexible than an open-end credit. Money gets disbursed in a lump sum and cannot be drawn out again even after repayment.</p>
<p>Money is lent for a specific amount of time before repayment begins. Repayment is made through regular, scheduled payments, not all at once. The borrower will also pay the principal and interest at this time.</p>
<h2>What Would You Need a Line of Credit for?</h2>
<p>There are many instances where you may need or find a line of credit useful. Below are some circumstances where you could <a href=”/blog-news/types-of-lines-of-credit.aspx” rel=”noopener” target=”_blank”>use your line of credit wisely</a>.</p>
<h3>Car Repair</h3>
<p>When you need an auto repair but don’t have the means to pay for it yourself, a line of credit can help. Emergency car repairs can be unexpectedly expensive.</p>
<p>If you rely on your vehicle to get to work every day, you’ll want to fix the problem as soon as possible. You can use a line of credit in this instance by taking out a <a href=”/personal-loans.aspx” rel=”noopener” target=”_blank”>personal loan</a> or applying for a new credit card.</p>
<h3>Unexpected Utility Bill</h3>
<p>Unexpected utility bills come as a shock to people that don’t have money saved up to cover them. If your utility bills change every month, this occurrence may happen to you.</p>
<p>To pay off the expenses with a low interest rate, you can take out a line of credit. There is no reason to get penalized for not paying a bill when you have this option available.</p>
<h3>Appliance Repair</h3>
<p>An appliance issue can make your daily life more complicated. It’s best to get these fixed right away.</p>
<p>The most <a href=”https://www.bobvila.com/slideshow/these-are-the-most-common-appliance-repairs-52965″ rel=”noopener” target=”_blank”>common appliance repairs</a> homeowners need are stovetop repairs, refrigerator repairs, oven repairs, etc. If you don’t have enough room in your budget to pay for these necessary repairs, get a line of credit.</p>
<h3>Fees for Your Child’s Schooling</h3>
<p>If your kids are on their way to college, you’ll have to figure out how to pay for it. You may have saved up for this moment for years, but with the increasing schooling costs, you still might not have enough.</p>
<p>With a line of credit, you can take a lump sum out to cover the necessary schooling costs. You won’t have to begin repayment until your child graduates from school.</p>
<h3>Unexpected Dental Work</h3>
<p>Whether you have a tooth that’s been bothering you for years, or you slipped and knocked a tooth out, a line of credit can cover the dental costs. Even with insurance, you may have to pay out-of-pocket fees for dental work.</p>
<h3>Veterinarian Bill</h3>
<p>If your pet needs immediate surgery or has to take a visit to the vet because they are sick, your insurance won’t cover the cost. Instead, use a line of credit to cover the bill all at once.</p>
<h2>Understanding the Different Lines of Credit</h2>
<p>Navigating the answer to how many lines of credit you should have doesn’t have to be complicated. As long as you educate yourself on each type and read the fine print, you’ll be in good hands. Using a line of credit is a great way to pay off unexpected occurrences, remodel or rebuild your home, cover business expenses, and boost your credit score.</p>
<p>If a traditional bank has denied you a line of credit, all hope is not lost. Apply online in <a href=”/personal-line-of-credit-loans/idaho.aspx” rel=”noopener” target=”_blank”>Idaho</a>, <a href=”/personal-line-of-credit-loans/kansas.aspx” rel=”noopener” target=”_blank”>Kansas</a>, <a href=”https://www.cash1loans.com/personal-line-of-credit-loans/missouri.aspx” target=”_blank”>Missouri</a>, <a href=”https://www.cash1loans.com/personal-line-of-credit-loans/louisiana.aspx” target=”_blank”>Louisiana</a> or <a href=”/personal-line-of-credit-loans/utah.aspx” rel=”noopener” target=”_blank”>Utah</a> with CASH 1 Loans to get approved for a line of credit in minutes.</p>
<p>All you need to do is know is where to look for suitable lenders. We’ll walk you through how to secure a line of credit when you have no credit or your score is low. Let’s get started!</p>
<h2>What is Considered a Bad Credit Score?</h2>
<p>The first thing you should check when looking for a line of credit is your credit score. A credit score is a rating that lenders use to determine whether you’re a reliable borrower. These ratings are typically determined by FICO, or the Fair Isaac Corporation, model of scoring. If you have a low credit score, then it likely means that you miss payments often.</p>
<p>So, what factors affect a credit score? A credit score is split into a variety of areas, each with its percentages. For example, 35% of your credit score is based on your payment history on past credit. FICO considers 30% of the score by the amount you owe, and your credit history’s length makes up 15%.</p>
<p>The final 20% is divided between the amount of new credit you have and the amount of existing credit. When all of these factors are tallied up, you get a score. The range of scores fall into these categories:</p>
<ul>
<li>800 to 850 is an excellent credit score</li>
<li>740 to 799 is a very good credit score</li>
<li>670 to 739 is a good credit score</li>
<li>580 to 669 is a fair credit score</li>
<li>300 to 579 is a poor credit score</li>
</ul>
<p>Generally, fair and poor credit scores are in the bad range of credit score rankings. If you want to learn more about your credit score and how it works, then make sure to check out <a href=”https://www.usa.gov/credit-reports” rel=”noopener” target=”_blank”>this resource here</a>.</p>
<h2>What is a Line of Credit?</h2>
<p>A line of credit is an option that allows you to access the amount of cash that you need. When it comes time to pay, you only owe interest in the amount you borrow. Many different lenders utilize this type of lending option since it often works as a flexible loan.</p>
<p>Once you withdraw money from your account, you can either pay it back immediately or extend it out over a specified period. This type of lending option is often more sought after than credit cards since it gives you access to funds when you need them without applying for a loan.</p>
<p>Make sure to read our <a href=”/frequently-asked-questions/line-of-credit-faq.aspx” rel=”noopener” target=”_blank”>line of credit FAQs</a> for more details. If you need cash for an emergency, you can easily access funds. However, like credit cards, a line of credit does require monthly payments.</p>
<h2>Secured Line of Credit Vs. Unsecured Line of Credit</h2>
<p>There are two popular types of lines of credit: secured and unsecured. <a href=”/blog-news/what-secured-line-credit.aspx” rel=”noopener” target=”_blank”>Secured lines of credit</a> provide the lender with a lien to an asset that the borrower owns. That means that if the borrower defaults on payments, then the lender can seize this asset. Often this collateral comes in the form of a home or a car.</p>
<p>Secured credit is easy to get, and the interest rates are lower. However, if you aren’t able to make payments, then it can backfire on you. Lenders who issue unsecured lines of credit, on the other hand, can’t seize your assets if you default on payments.</p>
<p>Because of this, unsecured lines of credit are riskier for lenders. As such, they often have higher interest rates.</p>
<h2>How to Get a Line of Credit with Poor Credit</h2>
<p>So, you found out you have a bad credit score. The good news is that this isn’t the end of the world. It’s still possible to get <a href=”/blog-news/types-of-lines-of-credit.aspx” rel=”noopener” target=”_blank”>different types of lines of credit</a> even if your score isn’t great. In this section, we’ll walk you through how to do it.</p>
<h3>1. Know Your Credit Score Before Going Into the Process</h3>
<p>As we mentioned, it’s important to know your credit score before you begin looking for options. This will give you an idea of what to expect when it comes to lenders. If you fall in the FICO credit score’s poor or fair sections, it’s considered bad credit. Most lines of credit options can cater to people with scores of 550 or higher.</p>
<p>However, keep in mind that many of these options come with interest rates higher than traditional loans. Or, you will receive a small limit. That’s due to the high-risk nature of lending to someone with a bad credit score. So, what should you do if you have a score below 550 and still want a personal line of credit? If your credit score is low, you can check out these tips on <a href=”/blog-news/boost-my-credit-score.aspx” rel=”noopener” target=”_blank”>boosting your credit score</a>.</p>
<h3>2. Use Any Assets As Collateral For a Line of Credit</h3>
<p>If you want to avoid higher rates, then consider putting your property up as collateral. This can lead to lower rates while still maintaining a full line of credit. For example, if you own a home, you can borrow using any equity you have in it for collateral. This is known as a HELOC or a Home Equity Line of Credit.</p>
<p>However, be careful with these types of lines of credit. If you cannot make payments, you can easily lose any asset you put up as collateral. As such, it pays to be financially disciplined, so you don’t overspend with your credit line.</p>
<h3>3. Make Payments on Time</h3>
<p>Once you get approved for your line of credit, you must stay on top of your repayment schedule. If you can, try and make your payments as soon as they occur. That way, your credit improves instead of further decreasing. This is especially important if you have a secured line of credit. If you aren’t careful, you can lose your home, business, or car if you miss a payment.</p>
<p>So, how do you make sure that you stick to your repayment schedule? Try budgeting out the monthly amounts that you make on loan payments. Prioritize these payments over everything else if you can. Remember that if you make your payments on time, then you can also increase your credit limit in the future.</p>
<p>That means that you can borrow more if you ever need it. If you’re able to make consistent payments, you can also expect your credit history to improve, allowing you to apply for more involved loans.</p>
<h2>Have You Been Denied a Line of Credit? Contact CASH 1</h2>
<p>We hope this article helped give you some tips on securing a line of credit for poor credit. As you can see, it’s by no means impossible to secure credit when you’re credit history isn’t great. Unfortunately, it will take a little more work to find a lender that’s willing to take a bad credit line of credit.</p>
<p>Most of the time, a bank isn’t likely to approve you for a line of credit if you have poor credit. Luckily, the bank isn’t the only option. Direct online lenders like CASH 1 have higher approval rates. We fund your loan directly. Apply online if you live in <a href=”/personal-line-of-credit-loans/idaho.aspx” rel=”noopener” target=”_blank”>Idaho</a>, <a href=”/personal-line-of-credit-loans/kansas.aspx” rel=”noopener” target=”_blank”>Kansas</a>, <a href=”https://www.cash1loans.com/personal-line-of-credit-loans/missouri.aspx” target=”_blank”>Missouri</a>, <a href=”https://www.cash1loans.com/personal-line-of-credit-loans/louisiana.aspx” target=”_blank”>Louisiana</a>, or <a href=”/personal-line-of-credit-loans/utah.aspx” rel=”noopener” target=”_blank”>Utah</a>.</p>
<p>For over two decades, CASH 1 has been helping our communities get the financial help they deserve. If you’re interested in exploring your options, make sure to get in touch with us today.</p>
<h2>How To Qualify For an Unsecured Personal Loan</h2>
<p>Lenders most likely want to be sure that you are capable of repaying the loan on time. Hence, before they approve your loan application, they still might need to assess the risk by evaluating various factors. The following are some of the factors lenders commonly check to determine whether you qualify to take out an <a href=”https://www.cash1loans.com/personal-loans.aspx” target=”_blank”>unsecured personal loan</a>:</p>
<h3>Credit Scores</h3>
<p>Credit scores will give the lender an idea of how likely you are to repay debts. The higher your credit score, the more likely you will get a loan with favorable terms and a low interest rate. But if your credit score is low, you’re likely to land a loan offer with significantly higher interest and more stringent terms.</p>
<h3>Income</h3>
<p>Your income is one factor that lenders will look into because they want to make sure you make enough money to handle your debts. That is why it is best to consider your income before deciding to get any loan type for your needs.</p>
<h3>Debt-to-income Ratio</h3>
<p>The debt-to-income ratio shows your debts to your income. This helps the lender see if you have too much debt or can’t handle adding another loan. Moreover, the lower this ratio is, the better chances you have of getting your loan application approved.</p>
<h2>Benefits of Unsecured Personal Loans</h2>
<p>The main difference between the two types of loans is that a <a href=”https://www.creditninja.com/unsecured-vs-secured-debt/” target=”_blank”>secured loan requires collateral, and an unsecured loan doesn’t</a>. Besides that, there are other advantages to unsecured loans as well:</p>
<ul>
<li>You can take advantage of an unsecured personal loan to pay a wide variety of expenses. This includes unexpected repairs and major purchases.</li>
<li>They usually come with fixed monthly payments and fixed interest rates. This makes your finances easier to budget.</li>
<li>Most of the time, unsecured personal loans offer borrowers flexible repayment terms. This will most likely range from 12 to 84 months.</li>
<li>You can choose from a wide range of loan amounts that might range from $1,500 to $100,000.</li>
</ul>
<h2>What You Need to Watch Out For</h2>
<p>Although unsecured personal loans carry many advantages and are a good option for most people, it would be best to watch out for the following:</p>
<h3>Interest Rates</h3>
<p>Since collateral is not required, unsecured personal loans tend to have higher interest rates than <a href=”/blog-news/secured-loan-definition.aspx” rel=”noopener” target=”_blank”>secured loans</a>. Interest rates usually range from 5% to 36%. However, this will depend on your creditworthiness and the lender.</p>
<h3>Origination Fees</h3>
<p>Most of the time, lenders charge you fees to cover the loan process. These fees most likely range from 1% to 6% of your loan amount.</p>
<h3>Prepayment Penalties</h3>
<p>In some cases, lenders will charge you fees if you pay the monthly payment earlier than expected. However, when you pay your loan early, this means you can save some cash on interest charges. That is why it would be best to avoid unsecured personal loans with prepayment penalties.</p>
<h2>What if You Default on an Unsecured Personal Loan?</h2>
<p>Having late or missed payments and defaulting on an unsecured personal loan will not cost you any collateral. However, it will most likely hurt your credit score because your payment history is one of your credit score’s most significant factors, and even one late payment can affect it.</p>
<p>If you miss a payment, the lender will inform you (most likely more than once) regarding the matter. Also, the lender might provide you with a 30-day grace period to help bring your account current. Moreover, if you fail to do so, the lender will be left with no choice but to try to get payment from you one way or another.</p>
<p>Unlike other <a href=”/blog-news/examples-installment-loans.aspx” rel=”noopener” target=”_blank”>types of installment loans</a>, like home loans and auto loans, unsecured personal loans don’t require you to place the item you are purchasing as collateral. However, this does not mean that the lender can’t go after you to recover its losses if you start to default on your loan. The lender has the option to either take you to court to try to garnish your wages, send your account to a collection agency, or attempt to get hold of your property to pay your debt.</p>
<h2>In Conclusion</h2>
<p>Unsecured personal loans are a great funding option for just about anything you need. It also offers a wide range of loan amounts, flexible repayment terms, and fixed interest rates. However, you need to note that an <a href=”/blog-news/what-is-an-unsecured-loan.aspx” rel=”noopener” target=”_blank”>unsecured loan</a> is not your only option. So, before you decide what loan type is right for you, it would be best to consider how much you need to borrow, the purpose of getting a loan, and how quickly you can pay off the debt.</p>
<p><strong>Author Bio:</strong></p>
<p><img alt=”Finance Blogger David Owens” src=”/Portals/0/Images/blog/loans/david-owens.png” width=”149″ /></p>
<p>David Owens is a seasoned content writer specializing in finance – debt management, entrepreneurship, and business finance. When not writing, he travels with his cat, Mellie.</p>
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By citoyen.chouette on 2022-03-31 12:25:26